GIFT  OF 


REAL  ESTATE 

AND  ITS  TAXATION  IN 

PHILADELPHIA 


QUESTIONS  AND  ANSWERS  RELATING 

TO  A  PROPOSED  SYSTEM 

OF  ASSESSMENT 


PUBLISHED  BY  THE  MAYOR 
1913 


o>  ^t-^~v-»vxv"s.    ^O  cr~2--4 


REAL  ESTATE 

AND  ITS  TAXATION  IN 

PHILADELPHIA 


QUESTIONS  AND  ANSWERS  RELATING 

TO  A  PROPOSED  SYSTEM 

OF  ASSESSMENT 


PUBLISHED  BY  THE  MAYOR 
1913 


Foreword 

The  subject  of  this  pamphlet  is  of  vital  importance  to  every 
man,  woman  and  child  in  Philadelphia.  It  matters  little  whether 
the  particular  suggestions  set  forth  in  the  following  pages  are 
wise  or  unwise.  The  urgent  matter  is  that  tax-payers,  real  es- 
tate men,  builders,  members  of  building  and  loan  associations, 
and,  indeed,  all  thoughtful  citizens,  should  familiarize  themselves 
with  this  subject;  look  into  it  carefully,  each  from  his  own  point 
of  view;  and  discuss  it  in  public  and  private.  If  this  is  done  a 
proper  solution  of  our  present  difficulties  will  soon  be  forthcoming. 
To  aid  in  such  intelligent  study  and  discussion,  I  gladly  take  the 
opportunity  of  giving  publicity  to  what  I  know  to  be  a  careful, 
conscientious  and  informing  study  of  methods  of  assessing  real 
estate  for  purposes  of  taxation. 

I  appreciate  very  deeply  the  public  service  rendered  by 
Messrs.  Arthur  Edwin  Post  and  Robert  Dunning  Dripps  in  the 
preparation  of  this  pamphlet. 

RUDOLPH  BLANKENBURG, 

Mayor. 
May  26,  1913. 


[3] 
265458 


Preface 

AMONG  the  more  important  sources  of  city  revenue  which  were 
considered  and  reported  upon  by  the  Advisory  Committee  on 
Municipal  Finance,  appointed  by  joint  resolution  of  Councils 
October  4,  1912,  is  the  subject  of  real-estate  taxes  and  their 
assessment.  At  the  numerous  meetings  of  this  committee  much 
attention  was  given  to  methods  of  assessing  real  estate  in  this 
and  other  cities,  and  to  the  question  as  to  whether  this  city's 
revenue  might  be  increased  by  the  introduction  of  improved 
methods  of  real  estate  assessment.  One  of  the  direct  results  of 
the  work  of  this  committee  has  been  the  preparation  of  this 
pamphlet,  and  the  final  conclusions  and  recommendations  of  the 
committee  are  included  as  an  appendix. 

The  authors  have  attempted  in  this  "primer"  on  the  assess- 
ment and  taxation  of  real  estate  to  explain  in  simple,  yet  compre- 
hensive, terms,  some  of  the  details  embraced  in  a  system  for 
assessing  realty,  which  has  been  suggested  for  adoption  in  Phila- 
delphia. As  a  result  of  the  recent  consideration  and  discussion  of 
the  present  method  of  assessment,  a  more  or  less  general  agree- 
ment seems  to  exist  that  certain  changes  would  be  desirable. 
The  proposed  system  of  assessment  would  undoubtedly  better 
the  situation,  and  in  order  that  those  who  pay  taxes  and  those 
who  administer  the  tax  laws  may  understand  its  principal 
features,  this  series  of  questions  and  answers  has  been  prepared. 
It  is  hoped  that  many  of  the  technical  points  in  regard  to  the 
question  of  assessing  real  estate  may  be  clarified  within  the  fol- 
lowing pages.  In  some  instances  the  authors  have  inserted 
questions  and  answers  setting  forth  principles  and  methods  in 
vogue  in  other  cities,  the  wisdom  of  which  may  well  be  ques- 
tioned. In  every  such  case,  however,  the  information  given  was 
deemed  of  sufficient  interest  and  importance  to  warrant  its  in- 
clusion. 


In  the  preparation  of  this  pamphlet  the  assistance  rendered 
by  Lawson  Purdy,  President  of  the  Department  of  Taxes  and 
Assessments  of  the  city  of  New  York,  has  been  invaluable. 
While  Mr.  Purdy  should  not  be  held  accountable  for  any  state- 
ments herein  contained,  as  it  was  thought  unreasonable  to 
burden  him  with  reading  so  lengthy  a  manuscript,  the  fact  re- 
mains that  without  him  this  pamphlet  would  never  have  been  pre- 
pared. Much  valuable  material  was  also  found  in  the  reports 
of  the  National  and  International  Tax  Associations,  the  reports 
of  various  state  commissions  and  conferences  on  taxation,  the 
report  of  the  hearings  before  the  congressional  committee  on  the 
assessment  and  taxation  of  real  estate  in  the  District  of  Columbia, 
and  from  addresses  and  articles  by  James  E.  Boyle,  Henry 
Bruere,  John  A.  Dix,  E.  W.  Doty,  Clarence  O.  Gardner,  Edward 
L.  Heydecker,  John  H.  MacCracken,  Charles  E.  Merriam,  Ray- 
mond V.  Phelan,  John  B.  Phillips,  L.  G.  Powers,  C.  Linn  Seiler, 
Edwin  R.  A.  Seligman,  Solomon  Wolff,  and  others.  Many  ver- 
batim quotations  have  been  made  from  these  documents,  and 
grateful  acknowledgment  is  herewith  extended  to  all  those  authors 
who  have  helped  so  considerably,  yet  unconsciously,  in  the  for- 
mation of  these  questions  and  answers. 

ROBERT  D.  DRIPPS 
ARTHUR  E.  POST 
PHILADELPHIA,  PA.,  May  24,  1913. 


[6] 


Contents 

PAGE 

FOREWORD  BY  MAYOR  BLANKENBURG 3 

PREFACE 5 

INTRODUCTION 
I.  REAL  ESTATE  is  THE  MOST  DEPENDABLE  SUBJECT  FOR  PERMANENT 

TAXATION 1 1 

II.  WHAT  is  MEANT  BY  UNFAIR  OR  INEQUITABLE  TAXATION n 

III.  EQUALIZATION  is  THE  GOAL  TOWARD  WHICH  THE  MOST  APPROVED 

METHODS  OF  ASSESSMENT  SHOULD  STRIVE 12 

IV.  METHODS  OF  ASSESSMENT  NOW  EMPLOYED  IN  PHILADELPHIA 12 

A   PROPOSED  SYSTEM  OF  REALTY  ASSESSMENT  FOR 
PHILADELPHIA 

V.  PROPERTY  TO  BE  ASSESSED  AT  FULL  VALUE 15 

VI.  SEPARATE  ASSESSMENTS  OF  (i)  LAND,  AND  (2)  IMPROVEMENTS.  ...  17 

VII.  ORGANIZATION  AND  PERSONNEL  OF  THE  DEPARTMENT 21 

1.  Board  of  Revision 21 

2.  Assessors,  Clerks,  Etc 23 

3.  Assessment  Lists  Prepared  by  Districts 26 

VIII.  TOOLS  AND  METHODS  OF  PROCEDURE  OF  THE  DEPARTMENT  ....  26 

1.  Block  and  Lot  Maps 26 

2.  Land  Value  Maps 28 

3.  Factors  of  Value  of  New  Buildings 41 

4.  True  Consideration  to  be  Stated  in  Deeds 45 

5.  Assessor's  Field  Books 46 

6.  Direct  Communication  with  the  Public 48 

7.  Policy  of  Systematic  Publicity 48 

IX.  SOME  BENEFITS  AND  RESULTS  OF  SUCH  A  SYSTEM 51 

APPENDIX 

QUOTATION  FROM   REPORT  OF  ADVISORY  COMMITTEE  ON  MUNICIPAL 
FINANCE  RECOMMENDING  THE  PRINCIPAL  FEATURES  OF 

THE  PROPOSED  SYSTEM 55 


Real  Estate  and  Its  Taxation  in 
Philadelphia 


Introduction 

I.  MOST   DEPENDABLE  SUBJECT   FOR   PERMANENT 

TAXATION 

1.  What  is  the  most  dependable  subject  for  permanent  taxa- 

tion? 

Land,  whether  improved  or  unimproved,  both  classes 
being  included  in  the  general  term  "real  estate." 

2.  Why? 

Because,  being  tangible,  an  assessor  can  see  it,  and  being 
relatively  immovable,  it  cannot  run  away.  The  tax  on 
real  estate  is  probably,  on  the  whole,  the  most  equitable  in 
its  distribution,  the  simplest  in  its  administration,  and  the 
most  productive  in  proportion  to  the  conscious  sacrifice  in- 
volved, and  carries  with  it  fewer  evil  consequences  than 
any  tax  system  hitherto  devised. 

II.  UNFAIR  OR  INEQUITABLE  TAXATION 

3.  What  is  meant  by  unfair  or  inequitable  taxation  of  real 

estate? 

Taxation  of  real  estate  is  unfair  or  inequitable  if  one  tax- 
payer is  made  to  pay  a  proportionately  larger  tax  on  real 
estate  belonging  to  him  than  some  other  taxpayer  has  to 
pay  on  real  estate  subject  to  the  same  tax,  due  allowance 
being  made  for  the  difference  in  value  of  the  two  properties. 

4.  What  is  generally  the  cause  of  unfair  or  inequitable  taxation? 

The  cause  of  unfair  or  inequitable  taxation  is  usually 
defective  methods  of  assessment,  which  make  it  almost 
impossible  for  an  assessor  to  arrive  at  the  proper  valua- 
tion of  certain  large  classes  of  real  estate.  The  tools 
placed  at  the  disposal  of  Philadelphia  assessors  today  may 
enable  them  to  deal  intelligently  with  small  homesteads, 
most  of  which  are  now  assessed  at  full  value;  they  are 
wholly  inadequate,  however,  when  it  comes  to  large  and 
costly  buildings.  In  order  to  keep  on  the  safe  side,  our 
[ii] 


assessors  tend  to  assess  these  large  and  costly  build- 
ings below  their  actual  value.  Any  reasonably  intelligent 
man,  with  a  little  knowledge  of  the  subject,  can  estimate 
with  some  degree  of  correctness  the  value  of  the  laborer's 
cottage  or  of  the  modest  dwelling,  costing  say,  $5000;  but 
where  can  the  assessor  be  found,  under  the  system  now 
obtaining  in  Philadelphia,  who  can  tell  how  much  it  costs 
to  erect  a  modern  office  building,  a  great  hotel,  a  palatial 
residence,  or  other  like  structure?  If  an  assessor  cannot 
compute,  or  ascertain  with  some  degree  of  certainty,  the 
approximate  cost  of  constructing  such  a  building,  how 
can  he  properly  assess  such  a  building? 

III.  EQUALIZATION— THE  GOAL 

5.  What  is  the  goal  toward  which  the  most  approved  methods  of 

property  assessment  must  strive? 

The  goal  is  neither  the  increase  nor  decrease  of  revenue  to 
the  city,  but  the  equalization  of  assessments  as  between 
man  and  man. 

IV.  PHILADELPHIA  ASSESSMENT  METHODS 

6.  How  is  real  estate  assessed  in  Philadelphia  at  the  present 

time — i.  e.,  what  departmental  organization  is  provided 
to  do  the  work  and  what  methods  of  assessment  are 
employed? 

The  assessment  of  real  estate  in  Philadelphia  is  performed 
by  a  body  known  as  the  Board  of  Revision  of  Taxes,  con- 
sisting of  three  members  appointed  by  the  judges  of  the 
Courts  of  Common  Pleas,  under  an  Act  of  Assembly.  It 
is  legally  a  county  body,  and  has  no  direct  responsibility  to 
any  one.  It  has  no  direct  administrative  connection  with 
the  city  government  as  such,  and  neither  the  mayor,  city 
councils,  nor  the  city  controller  can  legally  affect  its  ad- 
ministration or  policy. 

The  city  is  divided  into  thirty-five  assessment  districts,  and 
two  assessors  for  each  district  are  appointed  by  the  Board 
of  Revision.  Assessors  are  furnished  with  books  called 
"Street  blotters"  on  May  I5th  of  each  year,  and  the  as- 
sessment of  all  property  in  the  city  is  completed  by  August 
1 5th. 

[12] 


Assessments  are  supposed  to  be  made  at  100  per  cent, 
fair  cash  valuation,  i.  e.,  at  what  assessors  believe  prop- 
erties would  sell  for  at  a  bona  fide  sale  after  full  pub- 
lic notice.  In  determining  values,  the  assessors  are 
supposed  to  take  into  account  recent  sale  values  in  the 
particular  neighborhood,  the  previous  years'  assessments 
on  such  properties,  improvements  made,  and  any  informa- 
tion obtainable  from  mortgage  transactions  and  other 
records  in  the  office  of  the  recorder  of  deeds.  In  some 
cases  the  frontage  determines  the  value ;  in  other  cases  the 
area;  in  others,  the  question  of  relative  location.  In 
short,  the  judgment  of  the  assessor,  supported  by  any 
available  information,  is  the  basis  of  the  original  assess- 
ment. The  assessors,  in  addition  to  tabulating  the  value 
of  each  property,  also  record  the  street  number,  dimensions 
of  property,  kind  of  building,  or  other  improvements, 
owner's  name,  and  transfers  made  in  ownership  since  the 
last  assessment.  The  Board  of  Revision  then  corrects 
errors  in  the  returns,  either  on  its  own  initiative  or  on  ap- 
plication of  taxpayers. 

About  November  1st  a  second  assessment  is  made  to  cor- 
rect former  errors  and  include  new  buildings  and  improve- 
ments. Immediately  thereafter  the  district  records  are 
rearranged  by  wards  and  copied  into  ward  books,  tripli- 
cate copies  being  made.  The  original  of  these  is  kept 
in  the  office  of  the  Board  of  Revision  and  is  open  to 
public  inspection.  The  two  remaining  copies  are  sent 
respectively  to  the  receiver  of  taxes  and  the  city  controller. 
The  ward  records  thus  made  out  show  in  separate  columns 
the  assessed  value  of  the  realty  and  personalty,  the  di- 
mensions of  the  property,  street  number,  ward  number, 
and  owner's  name.  Since  the  assessment  of  personalty  is 
so  different  in  character  from  the  assessment  of  realty,  it 
is  obvious  that  separate  records  would  be  desirable  for 
recording  this  tax. 

The  Board  is  required  by  law  to  submit  to  city  councils 
on  or  before  the  1st  day  of  November  of  each  year,  through 
the  mayor,  the  figure  of  the  total  amount  of  assessed  valu- 
ation of  all  taxable  property  within  the  city.  This  figure 
is  used  in  determining  the  tax-rate  for  the  succeeding  year. 
[13] 


A  Proposed  System  of  Realty  Assessment 
for  Philadelphia 

V.  FULL  VALUATION  ASSESSMENTS 

7.  At  what  per  cent,  of  its  value  should  property  be  assessed 

for  purposes  of  taxation? 

At  true  value,  or  100  per  cent.,  which  has  been  denned  in 
this  city  as  the  value  at  which  a  property  would  sell  if 
sold,  singly  and  alone,  for  cash,  at  a  bona  fide  sale,  after 
full  public  notice.  In  Washington  true  value  is  defined 
as  the  sum  which  a  purchaser  who  wishes  to  buy  and  is 
not  compelled  to  buy  would  give  to  a  person  who  wishes 
to  sell  and  is  not  compelled  to  sell.  In  theory,  at  least, 
the  principle  of  true  value  assessment  is  already  estab- 
lished in  Philadelphia. 

8.  Where  the  law  as  in  Pennsylvania  fixes  the  standard  of 

valuation  for  real  estate  at  the  price  it  would  bring  at 
bona  fide  sale  after  full  public  notice,  has  the  assessor 
the  legal  right,  in  determining  the  value  for  purposes  of 
taxation,  to  take  into  account  the  assessed  valuation  of 
other  pieces  of  real  estate  in  the  neighborhood? 
Yes.     The  Supreme  Court  of  Pennsylvania  decided  in 
1909  (Coal  Company,  appellant  vs.  Luzerne  County,  225 
Penna.,  267)  that:   "All  real  estate  should  be  assessed  at 
its  actual  market  value,  but  it  must  be  assessed  at  a  uni- 
form standard  of  value  throughout  the  district,  even  if  the 
valuation  is  below  market  value." 

9.|In  determining  values,  what  are  some  of  the  sources  of  in- 
formation that  assessors  sometimes  have  to  consider? 

1 .  The  previous  assessment  for  purposes  of  taxation. 

2.  The  consideration  paid,  as  set  forth  in  recorded  deeds, 
etc. 

3.  Amount  loaned  on  mortgage  secured  thereon. 

[15] 


4.  Valuations  as  sworn  to  in  petitions  to  the  Orphans' 
Court. 

5.  Valuations  as  sworn  to  in  petitions  to  the  Courts  of 
Common  Pleas. 

6.  Valuation  placed  on  same  in  condemnation  proceed- 
ings. 

7.  Valuations  set  forth  as  required  by  law  in  sworn  state- 
ments made  by  corporations  as  to  real  estate  owned  by 
them. 

8.  Amount  loaned  on  mortgage  secured  thereon  by  finan- 
cial institutions  allowed  by  law  to  lend  only  on  a  cer- 
tain fixed  percentage  of  the  real  value. 

9.  Amount  offered  in  good  faith  for  the  same. 

10.  The  rent  paid  therefor. 

1 1 .  Value  placed  thereon  by  owner. 

12.  Value  placed  thereon  by  seller. 

13.  Value  placed  thereon  by  real -estate  experts. 

14.  Information  in  possession  of  title  insurance  companies. 

15.  Volunteer  information  given  to  the  assessors  by  per- 
sons alleging  special  information  on  this  subject. 

1 6.  The  so-called  "city  services,"  of  which  said  real  estate 
has  the  benefit. 

17.  The  amount  and  character  of  traffic  in  front  of  or 
near  the  same. 

1 8.  The  nearness  of  said  real  estate  to  trolley  lines,  ele- 
vated and  subway  lines,  railroad  stations,  etc. 

19.  The  character  of  the  neighborhood  in  which  said  real 
estate  is  situated. 

20.  Recent  or  contemplated  improvements  in  the  neigh- 
borhood. 

21 .  Whether  or  not  undesirable  elements  are  present  in  the 
neighborhood. 

22.  The  grade  of  the  land.      How  this  fits  into  the  city 
plan. 

23.  Whether  or  not  said  real  estate  is  a  corner  property. 

24.  If  not,  whether  it  has  access  to  two  streets,  one  in 
front  and  one  in  rear  thereof. 

25.  Whether  or  not  it  is  rented,  occupied  by  owner,  or 
empty. 

26.  Whether  or  not  it  has  a  water-front. 

f  16] 


27.  Whether  or  not  it  has  or  is  in  a  position  to  obtain  a 
railroad  siding. 

28.  The  cost  of  construction  of  buildings  thereon,  as  in- 
dicated in  the  records  of  the  bureau  of  building  in- 
spection. 

29.  Information  as  to  the  value  of  the  buildings  in  the 
possession  of  the  fire-underwriters. 

30.  The  value  placed  upon  the  buildings  by  fire-insurance 
experts. 

31.  The  value  placed  upon  the  buildings  by  builders  and 
contractors. 

32.  Whether  or  not  the  buildings  are  in  proper  repair. 

33 .  Probable  cost  of  construction  of  buildings  by  cubic  feet. 

34.  Probable  cost  of  construction  of  buildings  by  square 
feet  of  floor  space. 

35.  Whether  or  not  the  possible  uses  of  the  buildings  are 
suited  to  the  neighborhood  in  which  they  are  located. 

36.  Whether  or  not  the  property  is  so  situated  as  to  be 
practically  necessary  to  the  municipality  or  to  some 
company  or  individual  other  than  the  owner  for  a 
contemplated  improvement. 

37.  The  value  of  the  adjacent  property. 

38.  The  value  of  properties  of  practically  the  same  char- 
acter situated  in  practically  the  same  sort  of  neigh- 
borhood elsewhere  in  the  city. 

39.  Personal  inspection  by  the  individual  assessor. 

40.  Newspaper  reports  as  to  sales,  rental,  etc. 

41.  Testimony  given  before  the  Board  of  Revision  on 
appeals. 


VI.  SEPARATE  ASSESSMENTS  OF  LAND  AND 
IMPROVEMENTS 

10.  What  is  meant  by  a  separate  assessment  of — (1)  land  and 

(2)  improvements? 

By  a  separate  assessment  of  land  and  improvements  is 
meant  a  determination  of  land  values  independent  of  the 
values  of  the  improvements  thereon,  and  recording  these 
values  separately  on  the  assessment  records.  Every  well- 
considered  assessment  of  a  lot  with  a  building  standing 
[17] 


upon  it  is  the  result  of  two  distinct  mental  operations, 
namely  the  assessment  of  the  land  and  the  assessment  of 
the  building. 

11.  Where  has  the  separate  assessment  of  land  and  improve- 

ments been  tried? 

Separate  assessment  of  land  and  improvements  has  been 
practised  in  New  York  city  for  ten  years,  and  in  Washing- 
ton for  seventy-five  years.  Many  other  cities  now  do 
likewise,  including  Cleveland,  Ohio;  East  St.  Louis, 
Springfield,  and  Joliet,  111.;  Houston,  Texas;  and  several 
cities  in  Canada.  All  the  cities  of  New  York  State  have 
been  making  their  assessments  in  this  way  since  1911,  and 
also  the  cities  of  New  Jersey  and  Massachusetts.  It  ob- 
tained in  California  twenty-five  years  ago.  It  was  found, 
long  before  it  became  a  regular  method  in  so  many  places, 
that  it  had  been  the  ordinary  custom  of  many  assessors, 
who  had  learned  by  experience  that  it  is  much  easier  to 
make  an  accurate  assessment  if  they  put  on  their  books 
the  value  of  the  land  first  and  the  value  of  the  improve- 
ments afterward. 

12.  What  have  been  the  results? 

In  all  cities  where  the  separate  assessment  of  land  and 
improvements  has  been  tried,  it  has  received  the  general 
indorsement  of  real  estate,  business,  and  professional  men. 
It  has  established  standards  of  value  for  sale  and  rental 
operations,  and  no  better  method  for  securing  fair  and  even 
assessments  has  yet  been  devised.  The  separation  of  land 
and  improvement  values  is  both  a  stimulus  to  the  assessor 
to  do  careful  work  and  a  check  upon  him  to  prevent  dis- 
honest work,  because  it  enables  taxpayers  to  study  intelli- 
gently methods  of  assessment  and  compare  results  as 
between  adjoining  properties.  One  cannot  examine  an 
assessment  roll  or  map  and  get  anything  out  of  it  unless 
the  land  value  is  separated  from  that  of  the  buildings  and 
improvements.  By  studying  land  values  and  disregard- 
ing the  value  of  the  improvements,  a  good  method  is  pro- 
vided for  comparing  land  values  by  sections  and  deter- 
mining whether  there  is  any  inequality  between  the 
assessments  of  one  section  as  compared  with  those  of 
another  section. 

[18] 


13.  What  are  the  different  systems  of  recording  the  separate 

assessment  of  land  and  improvement  values  on  the 

assessors'  books? 

There  are  two  systems  used  to  show  separately  the  values 
of  land  and  improvements.  One  system  is  to  use  assess- 
ment records  provided  with  three  columns,  for  showing, 
respectively,  first,  the  land  value ;  second,  the  improvement 
value;  and  third,  the  total  value  of  the  property.  A 
second  system  provides  for  only  two  columns  in  the  assess- 
ment records,  showing,  first,  the  land  value,  and  second, 
the  total  value  of  the  property. 

14.  Where  is  the  three-column  system  used? 

In  Maine,  New  Jersey,  and  Massachusetts. 

15.  Where  is  the  two-column  system  used? 

The  two-column  system  is  required  by  the  laws  of  New 
York  for  all  cities  in  the  State. 

16.  What  advantage  has  the  two-column  over  the  three-column 

system? 

The  assessor  judging  values  should  have  his  attention  con- 
centrated first  on  the  main  element  of  value,  the  land. 
Then  his  attention  should  be  concentrated  on  what  the 
total  is  worth,  land  plus  improvement,  and  not  upon  the 
building  itself.  If  a  separate  column  is  provided  for  as- 
sessing the  building,  the  assessor  has  his  attention  at- 
tracted to  this  one  feature,  and  the  tendency  is  to  value  a 
building  which  is  obsolete,  or  which  has  depreciated  by 
age,  as  if  it  had  not  so  depreciated.  The  assessor  is  not 
likely  to  do  so,  however,  where  his  attention  is  directed  to 
the  two  questions:  What  is  the  land  worth?  and  What  is 
the  land  plus  the  building  worth? 

The  two-column  system  has,  therefore,  the  valuable 
psychologic  effect  of  forcing  the  assessor  to  recognize  the 
fact  that  the  value  of  a  building  is  simply  the  difference 
between  the  value  of  the  land  with  the  building  (or  the 
total  value)  and  what  the  same  parcel  of  land  would  be 
worth  if  the  building  were  removed. 

17.  How  can  an  assessor  arrive  at  the  separate  value  of  the  land 

apart  from  that  of  the  buildings  thereon? 
First,  there  may  be  in  the  immediate  neighborhood  one 
or  more  unimproved  parcels  of  land.     The  value  of  such 
[19] 


parcels  can  readily  be  ascertained  by  methods  well  under- 
stood by  most  assessors.  In  view  of  the  close  relation  be- 
tween the  values  of  parcels  of  land  situated  in  the  same 
neighborhood,  such  information  is  of  great  aid  in  arriving 
at  the  land  value  of  improved  parcels  of  land  situated 
nearby.  Second,  even  if  the  entire  neighborhood  is  built 
up,  there  is  almost  certain  to  be  one  or  more  lots  of  ground 
recently  sold  at  known  prices  and  thereafter  improved  at 
a  cost  more  or  less  accurately  ascertainable.  Such  inform- 
ation also  furnishes  a  clue  to  the  land  value  of  improved 
land  in  the  neighborhood.  Third,  every  built-up  neigh- 
borhood contains  a  fairly  large  number  of  buildings,  the 
construction  cost  of  which  can  be  ascertained  with  more  or 
less  accuracy;  after  this  is  known,  the  average  assessor 
can  make  proper  allowance  for  depreciation,  etc.,  and  so 
arrive  at  the  present  values  of  such  buildings.  By  de- 
ducting these  values  from  the  total  assessed  valuations  of 
the  various  properties  as  determined  by  recent  sales, 
mortgages,  rentals,  etc.,  the  land  values  can  be  rather 
definitely  fixed.  These  are  not  the  only  ways  in  which 
the  land  value,  as  distinct  from  that  of  the  improvements 
thereon,  may[be  determined,  but  they  serve  as  illustrations. 

18.  What  is  meant  by  "plottage"  and  how  is  the  assessment  of 

land  affected  thereby? 

Where  a  number  of  adjoining  lots  of  land  belonging  to  one 
owner  can  be  utilized  to  better  advantage  under  single 
ownership  than  as  separate  lots,  an  addition  is  sometimes 
made  to  the  assessed  valuation  of  the  lots  in  question  for 
what  is  called  "plottage." 

19.  What  are  some  of  the  things  which  an  assessor  should  bear 

in  mind  in  determining  the  value  of  a  building  apart 
from  that  of  the  land  upon  which  the  building  stands? 
When  a  building  is  suitable  for  the  site  and  not  depreciated 
by  age,  its  value  is  generally  the  cost  of  reproduction.  It 
can  never  be  more.  If  it  is  unsuitable  to  the  site  or  de- 
preciated by  age,  the  average  depreciation  in  value  can 
generally  be  determined  by  a  consideration  of  the  rental 
and  by  reference  to  the  tables  prepared  by  architects, 
engineers,  and  accountants,  which  show  the  average  de- 
preciation of  various  classes  of  buildings. 

[20] 


20.  Does  the  adoption  of  the  plan  to  state  separately  the  value 

of  land  and  the  value  of  improvements  have  a  tendency 
either  to  increase  or  to  decrease  the  assessed  value  of 
an  average  piece  of  real  estate? 

The  adoption  of  such  a  plan  generally  results  in  an  increase 
in  the  assessed  value  of  property.  If  the  assessment  was 
accurately  made  before  and  after  the  introduction  of  the 
proposed  plan  of  assessment,  it  naturally  follows  that  no 
change  in  valuation  would  result. 

21.  What  may  be  said  as  to  the  legality  of  a  separate  assessment 

of  land  and  improvements  under  the  Pennsylvania 
law  which  requires  assessors  to  assess  real  estate  at 
what  they  believe  it  would  bring  at  a  bona  fide  sale 
after  full  public  notice? 

It  is  both  legal  and  practical  to  so  assess  land  and  improve- 
ments, as  may  be  illustrated  by  the  following  citation: 
"  In  some  states  it  is  required,  and  in  all  it  is  proper,  even 
if  not  necessary,  that  the  improvements  should  be  valued 
separately  from  the  land,  although  the  two  valuations 
are  added  together  to  fix  the  total  assessment."  (Cyclo- 
paedia of  Law  and  Procedure,  vol.  37,  p.  1013,  1911.) 

VII.  ORGANIZATION  OF  DEPARTMENT 
BOARD  OF  REVISION 

22.  What  should  be  the  qualifications  of  the  members  of  the 

Board  of  Revision? 

No  department  of  the  city  government  calls  for  broader 
judgment,  greater  experience,  or  more  continuous  atten- 
tion than  this  department,  and  if  the  Board  of  Revision 
fairly  and  honestly  performs  its  duty,  it  will  see  that  the 
burden  of  maintaining  the  government  is  fairly  and  equit- 
ably distributed  upon  those  who  should  be  willing  to  bear 
the  burden,  and  who,  under  the  law,  are  required  to  bear 
it.  This  duty  can  be  performed  only  by  a  Board  of  Re- 
vision composed  of  members  who  are  thoroughly  conver- 
sant with  real-estate  values  and  actuated  by  the  highest 
ideals.  The  members  of  this  Board  should  be  qualified 
for  such  office  either  by  the  possession  of  expert  knowledge, 
unusual  technical  ability,  or  wide  business  training.  They 

[21] 


should  be  prohibited  from  holding  any  other  municipal 
office  or  from  engaging  in  any  other  business  during  their 
terms  of  office.  I  ' 

23.  What  objection  may  be  raised  regarding  the  method  whereby 

the  present  members  of  the  Board  of  Revision  are 
appointed  by  the  judges  of  the  Courts  of  Common 
Pleas? 

This  method  of  appointment  leaves  the  members  of  the 
Board  of  Revision  too  far  removed  from  popular  control. 
The  Board  is  neither  directly  responsible  to  the  people, 
to  the  elected  representatives  of  the  people,  nor  even  to  the 
power  that  appoints  them. 

24.  What  is  the  objection  to  making  them  elective? 

It  is  desirable  that  as  few  positions  as  possible  shall  be 
elective,  in  order  that  the  issues  presented  to  voters  shall 
be  simple  and  the  ballots  not  encumbered  with  multi- 
tudinous names.  There  is  no  more  reason  why  the  mem- 
bers of  the  Board  of  Revision  should  be  elected  by  popular 
vote  than  there  is  for  electing  the  directors  of  the  city 
departments.  If  appointed  by  an  elective  official,  like 
the  mayor,  responsibility  is  centered,  and  popular  control 
will  be  secured  at  all  times. 

25.  How  should  they  be  chosen  in  order  to  overcome  the  ob- 

jections as  stated? 

The  members  of  the  Board  of  Revision  should  be  appointed 
by  the  mayor,  subject  to  the  approval  of  Select  Council, 
as  are  the  administrative  heads  of  the  city  departments  at 
present.  They  should  also  be  subject  to  removal  by  him. 
Objection  is  sometimes  made  against  giving  the  appoint- 
ing power  the  option  to  remove  at  will  any  appointee,  on 
the  ground  that  certain  positions  are  essentially  non- 
political  and  appointment  for  a  term  of  years  frees  the 
official  from  undue  influence;  but  this  system  deprives 
the  voters  of  control  over  their  own  officials  by  dividing 
responsibility,  and  it  is  the  essence  of  popular  government 
that  the  voters  should  at  all  times,  or  at  frequent  intervals, 
exercise  effective  control  over  all  public  servants.  If  the 
members  of  the  Board  of  Revision  are  appointed  as  sug- 
gested, the  people  can  always  exercise  an  effective  control 
over  them  through  the  mayor,  who  is  an  elective  official. 

[22] 


26.  How  are  the  assessing  authorities  selected  in  some  other 

large  cities  of  this  country? 
Baltimore.    The  three  members  of  the  Appeal  Tax  Court 

are  appointed  by  the  mayor. 

Boston.         The  seven  members  of  the  Board  of  Assessors 
are  appointed  by  the  mayor  and  are  subject 
to  the  approval  of  the  Civil  Service  Com- 
mission. 
Chicago.       The  five  members  of  the  Board  of  Assessors 

are  elected. 

New  York.  The  Board  of  the  Department  of  Taxes  and 
Assessments,  consisting  of  seven  members,  is 
appointed  by  the  mayor. 

Pittsburgh.  The  three  members  of  the  Board  of  Assess- 
ment and  Revision  of  Taxes  of  Allegheny 
County  are  appointed  by  the  County  Com- 
missioners. 

St.  Louis.      The  Board  of  Assessors  consists  of  a  presi- 
dent, elected  by  the  people,  and  twelve  dis- 
trict assessors,  appointed  by  the  mayor. 
So  far  as  known  there  is  no  other  city  in  the  United  States 
where  the  body  corresponding  to  the  Philadelphia  Board 
of  Revision  is  appointed  by  the  judges.     Such  a  method 
of  appointment  is  both  undemocratic  and  unAmerican. 
Its  effect  is  not  only  bad  on  the  Board  of  Revision,  but,  if 
possible,  even  worse  on  the  judges  themselves. 

27.  What  should  be  the  term  of  office  of  the  members  of  the 

Board  of  Revision? 

They  should  be  appointed  for  a  period  of  three  years,  one 
retiring  each  year,  and  should  be  eligible  to  reappoint- 
ment.  While  there  is  no  magic  virtue  in  the  term  sug- 
gested, it  is  believed,  on  the  whole,  to  be  the  most  sat- 
isfactory. 

ASSESSORS  AND  CLERKS 

28.  What  should  be  the  qualifications  of  assessors? 

Assessors  should  be  required  to  pass  successfully  a  com- 
petitive civil-service  examination  designed  to  select  men 
having  a  thorough  knowledge  of  local  real-estate  condi- 
tions and  a  fair  amount  of  judgment  in  determining 
[23] 


property  valuations.  They  should  give  their  entire  time 
to  their  work  and  be  engaged  in  no  other  business.  As- 
sessors should  hold  office  during  good  behavior,  and  this  in 
turn  will  give  to  the  department  a  permanence  of  policy 
greatly  to  be  desired. 

29.  How  should  assessors  be  chosen? 

They  should  be  appointed  by  the  Board  of  Revision,  after 
civil-service  examination,  and  subject  to  removal  for  cause. 

30.  Would  the  adoption  of  the  proposed  system  involve  the 

supplanting  of  the  present  assessors  by  new  men? 
No.  While  it  may  be  desirable  to  employ  some  one 
familiar  with  the  new  system  to  explain  it  to  the  local 
assessors,  men  thoroughly  acquainted  with  realty  values 
in  Philadelphia  would  undoubtedly  be  most  competent 
to  apply  the  new  system.  It  would  be  unnecessary  and 
undesirable  to  supplant  local  assessors  with  new  men 
from  outside. 

31.  How  should  assessors  be  apportioned  throughout  the  city? 

The  city  should  be  divided  into  assessment  districts,  and 
no  district  should  contain  more  than  10,000  parcels  of 
real  estate.  In  sparsely  settled  territory  where  the  par- 
cels of  property  are  large,  and  in  congested  centers  where 
the  parcels  are  of  irregular  shape  and  values  are  high,  the 
number  of  parcels  in  any  one  assessment  district  should  not 
exceed  4000.  One  assessor  should  be  assigned  to  each 
district.  As  a  rule,  assessors  should  serve  continuously 
in  the  same  district,  becoming  more  and  more  familiar 
with  its  values  and  conditions.  It  is  impossible  for  one 
man  to  be  thoroughly  familiar  with  values  in  more  than 
a  comparatively  small  section.  It  might,  however,  be  de- 
sirable to  provide  occasionally  for  an  interchange  of 
assessors  between  districts,  or,  at  any  rate,  to  see  to  it 
that  each  assessor  spends  certain  days  in  every  year 
making  the  rounds  with  the  assessor  of  another  district. 

32.  Should  an  assessor's  work  be  distributed  uniformly  through- 

out the  year? 

Assessors  in  Philadelphia  are,  to-day,  employed  by  the 
year,  and  owing  in  part  to  the  immense  amount  of  clerical 
work  required  of  them,  are  kept  tolerably  busy  all  the 
time.  Apparently,  however,  the  actual  work  of  studying 
[24] 


and  assessing  values  is  largely  crowded  into  the  three 
months  from  May  15th  to  August  15th.  This  is  a  mis- 
take. So  far  as  possible  they  should  be  relieved  of  purely 
clerical  work,  and  should  spend  their  time  continuously, 
throughout  the  entire  year,  in  the  real  work  of  assessment! 
They  should  observe  and  carefully  follow  all  changes  of 
value,  and  steadily,  month  by  month,  add  to  their  knowl- 
edge and  experience.  All  records  should  be  kept  up  to 
date,  and  to  do  this,  as  well  as  to  relieve  the  assessors  of 
the  ordinary  clerical  work  of  transcribing  and  copying 
records,  etc.,  each  assessor  should  be  assisted  by  a  clerk 
appointed  after  competitive  examination.  This  arrange- 
ment of  duties  would  leave  the  assessors  free  to  attend  to 
the  more  important  function  of  determining  and  revis- 
ing property  values.  In  all  probability  more  equitable 
assessments  would  result  because  assessors  would  have  the 
opportunity  for  doing  their  work  more  deliberately,  care- 
fully, and  constantly. 

33.  Assuming  it  to  be  legal,  what  may  be  said  as  to  the  advisabil- 
ity of  hiring  assessors  outside  the  city  to  make  our 
assessments? 

The  intelligent  assessment  of  real  estate  for  purposes  of 
taxation  presupposes,  on  the  part  of  the  assessor,  a 
thorough  knowledge  of  local  conditions.  If  such  condi- 
tions are  ignored  and  an  attempt  is  made  to  build  up  from 
a  few  more  or  less  accurately  determined  valuations,  by 
means  of  hard-and-fast  mathematical  rules,  the  values  of 
all  other  real  estate  in  the  community,  the  result  may  be  a 
"scientific"  assessment,  but  it  will  be  satisfactory  to  no 
one  save  those  who  make  it.  When  a  city  calls  in  outside 
assessors,  it  ceases,  in  assessment  matters,  to  build  up, 
year  by  year,  information  absolutely  its  own  and  always 
at  its  disposal;  it  no  longer  trains  and  educates  to  in- 
creased efficiency  its  own  employees;  on  the  contrary, 
it  pays  for  the  education,  in  local  conditions,  of  non- 
residents, suffers  from  "scientific"  but  inequitable  as- 
sessments during  the  process,  and  every  year  becomes 
more  dependent  upon  non-resident  help.  No  city  should 
be  absolutely  dependent  upon  outside  help  for  performing 
its  own  functions. 

[25] 


ASSESSMENTS  BY  DISTRICTS 

34.  What  would  be  the  advantage  to  the  Board  of  Revision  of 

requiring  the  recording  of  assessment  lists  by  districts 
rather  than  by  wards,  as  is  done  at  present? 

The  law  requires  that  assessments  shall  be  made  by  wards, 
but  actually  the  assessments  are  originally  made  by  dis- 
tricts and  then  laboriously  transferred  into  ward  books  in 
order  to  conform  to  the  law.  This  process  involves  con- 
siderable time,  labor,  and  materials.  It  would  seem 
clearly  advisable,  therefore,  from  the  standpoint  of  the 
assessing  body,  to  amend  the  law  so  that  assessment  lists 
might  be  compiled  by  districts  rather  than  by  wards. 
There  is  a  question,  of  course,  as  to  whether  the  resultant 
advantage  to  the  assessors  and  the  Board  of  Revision 
would  be  more  than  counterbalanced  by  the  possible  con- 
fusion and  inconvenience  caused  by  such  a  change  to  real- 
estate  men,  title  insurance  companies,  and  to  owners  and 
prospective  purchasers  of  real  estate. 

VIII.  TOOLS  AND  METHODS  OF  THE  DEPARTMENT 

BLOCK  AND  LOT  MAPS 

35.  What  tools  should  be  placed  in  the  hands  of  assessors  to 

aid  them  in  their  work  under  the  proposed  system? 
The  most  useful  aids  are  block  and  lot  maps,  land  value 
maps,  and  factors  of  value  used  in  determining  the  con- 
struction cost  of  buildings.     In  Philadelphia  at  the  present 
time  the  assessors  do  their  work  without  any  of  these  aids. 

36.  Where  are  block  and  lot  maps  used  in  making  assessments? 

In  New  York,  Chicago,  Cleveland,  Newark,  and  many 
other  cities  in  the  United  States  and  Canada. 

37.  What  is  a  block  and  lot  map? 

In  preparing  block  and  lot  maps,  the  city  is  first  divided 
into  blocks,  which  are  parcels  of  land  surrounded  bystreets, 
or  streets  and  water-front,  and  may  contain  one  or  more 
city  squares,  but  generally  the  word  block,  as  used  in  this 
connection,  refers  to  an  area  not  exceeding  240,000  square 
feet,  which  is  equivalent  to  a  rectangular  plot  of  ground 
600  by  400  feet  in  area.  The  exact  boundaries  of  every 
separately  assessed  parcel  of  real  estate  in  the  city  are 
[26] 


shown  on  these  maps.  Blocks  are  numbered  consecu- 
tively from  one  upward.  The  separate  lots  or  parcels 
of  land  within  each  block  are  also  numbered  consecutively 
from  one  up  for  as  many  lots  as  are  comprised  within  each 
block.  The  city  is  then  divided  into  sections,  each  sec- 
tion containing  not  more  than  three  or  four  square  miles 
in  area.  The  sections  are  likewise  numbered  consecutively 
from  one  up. 

For  the  convenience  of  the  assessors  the  maps  are  bound 
in  volumes  of  suitable  size,  with  a  key  map  in  front.  In 
the  territory  where  the  street  system  has  not  become  suf- 
ficiently permanent  to  establish  unchangeable  block  lines, 
the  maps  are  temporary  and  are  called  tentative  maps. 
So  far  as  practicable,  however,  the  same  system  applies 
in  the  territory  only  tentatively  mapped.  Every  lot  is 
numbered,  and  its  position  is  designated  by  a  number  on 
the  map. 

The  length  of  all  boundary  lines  is  shown  on  the  maps  in 
feet  and  inches,  and  on  valuable  lots  of  irregular  shape  the 
area  is  shown  in  square  feet ;  on  larger  parcels  the  area  is 
shown  in  acres. 

(See  portion  of  a  block  and  lot  map  on  page  36.) 
38.  What  results  have  been  obtained  from  the  use  of  block  and 

lot  maps? 

Accurate  maps  are  the  foundation  of  a  good  system  of 
assessing  real  estate.  The  method  of  describing  real  es- 
tate by  block  and  lot  numbers  saves  much  labor  and  se- 
cures greater  accuracy.  On  the  assessment  rolls  the  blocks 
appear  consecutively,  and  within  each  block  the  lots  are 
placed  in  accordance  with  their  location  on  the  streets, 
commencing  at  one  corner  and  proceeding  continuously 
along  each  side  of  the  squares  which  constitute  the  block. 
Any  lot  may  be  located  rapidly  and  certainly  either  on  the 
assessment  roll  or  on  the  map.  It  will  readily  be  seen  that 
such  maps  facilitate  the  orderly  geographic  listing  of 
real  estate  for  purposes  of  taxation,  and  also  simplify  the 
description  of  real  estate  in  tax  matters  for  purposes  of 
identification.  In  Philadelphia  we  already  list  our  real 
estate  for  taxation  purposes  geographically,  rather  than 
alphabetically,  under  the  names  of  the  respective  owners, 
[27] 


so  that  the  introduction  of  block  and  lot  maps  is  perhaps 
less  important  here  than  it  would  be  in  many  other  cities. 
Even  so,  it  would  be  of  distinct  advantage.  These  maps 
are  used  by  the  assessors  in  computing  the  value  of  lots 
on  the  basis  of  the  unit  values  as  shown  by  the  land  value 
maps. 

LAND  VALUE  MAPS 

39.  Where  are  land  value  maps  used  in  making  assessments? 

In  New  York,  Cleveland,  Trenton,  Newark,  and  various 
other  cities. 

40.  How  do  land  value  maps  differ  in  purpose  from  block  and 

lot  maps? 

Land  value  maps  are  entirely  different  from  block  and  lot 
maps.  They  are  prepared  to  facilitate  comparison  of  land 
values  and  thus  to  assist  in  standardizing  and  equalizing 
the  assessments  of  land  for  purposes  of  taxation.  They 
are  generally  regarded  as  the  most  useful  aid  toward 
equalization  of  assessment  which  can  by  any  possibility 
be  placed  in  the  hands  of  an  assessor. 

41.  On  what  general  principle  is  the  utility  of  land  value  maps 

based? 

The  utility  of  land  value  maps  is  based  on  the  general 
principle  that  a  more  or  less  definite  relationship  tends  to 
exist  between  the  land  values  of  lots  of  the  same  general 
character  situated  in  the  same  immediate  locality  or  in 
other  localities  subject  to  similar  conditions. 

42.  What  is  a  "land  value  map"? 

A  land  value  map  is  a  map  which  shows  for  the  area  which 
it  covers,  first,  all  streets  and  water  front  (the  section, 
block  and  lot  lines  used  in  block  and  lot  maps  not  being 
indicated),  and  second,  by  figures  written  opposite  each 
of  the  four  sides  of  every  square,  the  value  per  front  foot 
of  an  average  inside  lot,  usually  situated  about  half-way 
between  the  two  corners,  fronting  on  the  street  along  which 
the  figures  are  written,  running  straight  back  from  the 
street,  being  neither  above  nor  below  the  grade  of  the 
street  and  having  a  depth  previously  ascertained  to  be 
the  usual  depth  of  lots  in  the  city  which  the  map  in  part 
represents. 

Where  the  same  value  per  front  foot  of  an  average  inside 
[28] 


^    lS§&   4000     soon     ^~-^  ^        - 


N> 

A  PORTION  OF  ONE  OF  THE  LAND  VALUE  MAPS  USED  IN  NEW  YORK  CITY,  SHOWING  UNIT 

VALUES  AND  BLOCK  NUMBERS. 

[29] 


lot,  situated  about  half-way  between  the  two  corners  and 
of  normal  grade  with  respect  to  the  street,  applies  equally 
to  the  land  on  opposite  sides  of  the  street,  the  figures 
representing  such  value  are  generally  shown  in  the  center 
of  the  street  and  but  once ;  where  the  value  per  front  foot 
of  such  an  average  inside  lot  is  not  the  same  for  the  land 
on  opposite  sides  of  the  street,  a  double  set  of  figures  is 
used  to  record  the  difference  in  value;  and  where  the 
value  per  front  foot  of  such  an  average  inside  lot  varies 
considerably  within  the  same  square  on  the  same  side  of 
the  street,  separate  figures  are  used  to  record  the  differ- 
ence. 

In  cases  where  the  land  is  not  divided  into  squares  by  city 
streets  the  value  per  acre  is  shown  at  appropriate  points. 
The  unit  values  indicated  on  land  value  maps  refer  to  the 
value  of  the  land  alone  as  apart  from  that  of  the  buildings 
or  improvements  thereon. 

43.  What  is  meant  by  an  "inside  lot"  ? 

By  an  inside  lot  is  meant  any  lot  other  than  a  corner  lot. 

44.  What  is  the  unit  of  area  popularly  used  at  present  in  com- 

paring the  land  values  of  lots  differing  in  size? 
There  is  none.  One  man  says  the  value  of  his  land  is  so 
much  per  acre ;  another  quotes  his  at  so  much  per  square 
foot;  another  says  his  is  worth  so  much  per  front  foot 
without  indicating  whether  the  figure  he  names  applies 
to  a  lot  fifty  feet,  one  hundred  feet,  or  two  hundred  feet 
in  depth.  It  is  obvious  that  there  is  no  proper  basis  for 
comparison  between  these  different  statements. 

45.  What  unit  of  area  has  been  adopted  as  the  standard  for  use 

in  comparing  land  values  on  land  value  maps? 
A  lot  having  a  frontage  of  one  foot  and  a  depth  ascertained 
to  be  that  of  the  average  city  lot  in  the  community  which 
the   map   represents.     In  New  York  city,  for  example, 
this  depth  is  one  hundred  feet. 

46.  Why  has  this  particular  unit  been  selected? 

First:  The  relatively  small  size  of  the  average  city  lot 
is  sufficient  reason  for  not  selecting  an  acre  as  the  unit  of 
quantity  by  which  to  compare  land  values  in  cities. 
Second:  In  any  given  lot  the  respective  square  feet 
usually  differ  in  value;  for  example,  those  square  feet 
[30] 


fronting  on  the  street  are  worth  more  than  those  in  the 
rear.  Hence  to  compare  the  land  value  of  lots  of  dif- 
ferent size  by  means  of  their  value  per  square  foot  would 
be  misleading. 

Third:  As  has  already  been  indicated,  to  compare  the 
land  value  of  lots  of  different  size  by  their  respective 
value  per  front  foot  is  equally  misleading  unless  their 
respective  depths  are  the  same. 

Fourth :  By  combining,  however,  the  familiar  idea  of  a 
front  foot,  with  a  depth  equal  to  that  of  the  average  lot  in 
the  city  (say  100  or  150  feet),  a  unit  is  reached,  easily 
comprehensible,  of  convenient  size  and  shape  for  use  in 
estimating  values,  and  at  the  same  time  taking  into  ac- 
count the  varying  values  of  the  different  parts  of  a  piece 
of  land  as  affected  by  their  respective  nearness  or  remote- 
ness to  the  street  on  which  it  fronts. 

47.  What  is  the  meaning  of  the  term  "unit  value"  as  applied  to 

land  value  maps? 

Lots  having  a  street  frontage  of  one  foot,  extending  back 
a  distance  equal  to  that  of  the  average  lot  in  the  city  (say 
100  or  150  feet),  usually  situated  about  half-way  between 
the  two  corners,  being  at  right  angles  to  the  street,  and 
being  of  normal  grade,  are  the  standard  units  of  area  used 
by  assessors  in  working  out  land  values  for  purposes  of 
comparison,  etc.,  by  means  of  land  value  maps;  and  the 
value  of  such  a  lot  is  termed  the  unit  value  of  the  (linear) 
square  on  which  it  fronts. 

48.  How  are  such  "unit  values"  determined? 

The  unit  value,  or  values,  for  any  given  (linear)  square 
are  determined  as  follows: 

a.  Select  an  inside  lot  near  the  center  of  the  square. 

b.  Ascertain  the  value  of  the  land  contained  therein  as 
apart  from  that  of  the  buildings  or  improvements. 

c.  If  it  is  off-grade,  allow  for  that  fact. 

d.  If  it  is  of  more  or  less  than  average  depth,  calculate  its 
value  if  of  normal  depth  (for  example,  100  or  150  feet). 

e.  If  it  is  of  irregular  shape,  add  from  adjoining  property 
or  subtract  from  the  lot  itself  to  make  it  a  square  or 
rectangular  lot  at  right  angles  to  the  street  and  allow 
for  such  addition  or  subtraction  in  determining  values. 

[31] 


f.  If  it  has  any  other  peculiarities  differentiating  it  from 
the  other  inside  lots  fronting  on  the  same  square,  allow 
for  all  such  peculiarities. 

g.  Having  done  all  this,  divide  the  value  arrived  at  by 
the  number  of  feet  frontage  and  the  quotient  will  be  a 
tentative  figure,  for  the  unit  value. 

h.  This  should  be  checked  up  by  treating  similarly  various 
other  inside  lots  on  the  same  square,  and  by  obtaining, 
through  proper  publicity,  all  possible  criticism  and 
suggestion. 

i.  If  it  is  found  that  there  is  a  marked  difference  in  the 
land  values  of  different  inside  lots  in  the  same  square 
and  on  the  same  side  of  the  street,  more  than  one  unit 
value  should  be  set  down  at  appropriate  points  on  the 
map  for  such  a  square. 

49.  What  relation  has  the  land  value  of  any  particular  lot  to  the 
unit  value  set  down  on  the  land  value  map  for  the 
(linear)  square  on  which  it  fronts? 

The  relation  which  the  land  value  of  any  particular  lot 
bears  to  the  unit  value  set  down  on  the  land  value  map 
for  the  (linear)  square  on  which  it  fronts,  depends  on  the 
character  of  the  lot  in  question.  If  it  is  an  average  inside 
lot  with  no  peculiarities  differentiating  it  from  the  other 
inside  lots  fronting  on  the  same  side  of  the  same  square, 
the  relation  is  largely  one  of  arithmetic.  If,  on  the  other 
hand,  it  is  a  corner  lot,  or  an  inside  lot  off  grade,  or  of 
irregular  shape,  or  unusual  in  depth,  or  in  any  other 
respects  peculiar,  this  arithmetical  relationship  comes 
into  play  only  after  careful  allowance  has  been  made  for 
all  such  peculiarities. 

Given,  however,  (i)  the  land  value  of  any  particular  lot, 
(2)  its  exact  dimensions  in  feet,  (3)  the  unit  value  for  the 
square  on  which  it  fronts,  (4)  accurate  information  as 
to  any  facts  differentiating  it  from  the  average  inside 
lot  fronting  on  the  same  (linear)  square,  and  (5)  a  per- 
centage table  to  be  used  in  determining  the  values  of  lots 
of  varying  depths  and  irregular  areas — there  should  then 
be  little  difficulty  in  checking  up  the  assessed  value  of 
the  land  as  apart  from  that  of  the  buildings  or  improve- 
ments thereon. 

[32] 


50.  What  are  some  of  the  benefits  to  be  derived  from  the  use  of 

land  value  maps? 

The  outstanding  benefit  to  be  derived  from  the  use  of  land 
value  maps  is  the  resulting  possibility  of  intelligent  com- 
parison of  real  estate  assessments.  Land  is  the  only  thing 
which  all  parcels  of  real  estate  in  the  city  have  in  common. 
Some  parcels  are  built  upon,  some  are  not.  Of  those  im- 
proved, some  have  brick  buildings,  some  stone,  some  wood. 
Moreover,  buildings  differ  in  character,  in  purpose,  in  age 
and  in  countless  other  respects.  So  that  even  if  all  assess- 
ments as  made  in  Philadelphia  to-day  were  published,  that 
of  itself  would  not  make  intelligent  comparison  of  assess- 
ments possible  for  the  average  man,  save,  perhaps,  in  the 
case  of  unimproved  properties;  but  where  land  value 
maps  are  used,  any  one  with  ordinary  intelligence  can  pass 
upon  the  fairness  with  which  the  assessor  has  done  his 
work  so  far  as  land  apart  from  buildings  is  concerned. 
Note,  however,  that  such  maps  are  practically  valueless 
without  the  separate  assessment  of  land  and  of  the  build- 
ings and  improvements  thereon. 

The  intelligent  comparison  of  assessments,  made  possible 
by  land  value  maps,  inevitably  results  in  greater  uni- 
formity and  equalization  of  assessments.  They  aid  the 
assessing  authorities  in  considering  claims  for  reduction 
and  in  satisfying  complainants  as  to  unfair  assessments; 
they  have  a  marked  effect  in  placing  a  check  on  favoritism 
if  an  assessor  is  disposed  to  favor  any  particular  taxpayer 
or  taxpayers. 

They  are  an  invaluable  check  on  the  work  of  the  individual 
assessor.  When  all  the  unit  values  determined  by  an  as- 
sessor are  spread  out  on  a  map,  it  is  for  the  first  time  pos- 
sible for  him  to  study  intelligently  and  comprehensively 
the  relation  of  the  various  assessments  made  by  him,  the 
one  to  the  other.  He  is  afforded  a  bird's  eye  view  of  his 
whole  assessment  district.  If  some  particular  assessment 
is  too  high  and  some  other  too  low,  such  facts  become  im- 
mediately apparent. 

Of  course,  unit  values  may  change  from  year  to  year  and 
must  be  constantly  revised  as  circumstances  warrant. 
Therefore,  land  value  maps  should  be  published  annually. 
[33] 


51.  What  is  meant  by  corner  influence? 

By  corner  influence  is  meant  the  enhanced  value  a  parcel  of 
land  carries  by  reason  of  its  proximity  to  or  location  on  the 
corner  of  two  intersecting  streets.  The  relative  value 
of  a  corner  lot  as  compared  with  that  of  an  interior  lot  de- 
pends upon  the  importance  of  the  two  streets  on  which  the 
corner  lot  fronts  and  the  location  in  the  city.  The  greatest 
increase  in  value  for  a  corner  lot  is  at  the  intersection  of 
two  streets  of  equal  importance  in  the  best  location,  and 
this  increase  diminishes  as  the  difference  between  the 
streets  increases,  until  one  of  the  intersecting  streets  may 
be  regarded  as  adding  nothing  to  the  property  in  excess  of 
the  value  of  an  easement  of  light  and  air.  Generally  it 
will  be  found  that  the  increment  due  to  a  corner  position 
extends  100  feet  in  each  direction  from  the  corner. 

52.  How  may  the  extent  of  corner  influence  be  determined? 

The  extent  of  the  corner  influence  and  the  consequent  ratio 
of  increase  in  value  are  sometimes  determined  in  accord- 
ance with  an  appropriate  basic  scale  of  percentage  values 
which  scale  is  decided  upon  in  advance  of  assessment  and  is 
based  upon  the  best  evidence  obtainable. 
In  Cleveland  and  other  cities  that  have  adopted  the  Somers 
system,  an  imaginary  corner  lot  of  100  feet  square  is 
divided  into  100  squares,  each  10  feet  on  a  side.  Percent- 
age values  are  then  worked  out  by  a  method  of  computa- 
tion in  accordance  with  secret  formulae  owned  by  the 
Somers  system.  This  appears  to  be  the  only  mathematical 
rule  used  in  determining  corner  influence.  In  Newark, 
corner  lots  in  the  business  section  are  assessed  50  per  cent, 
higher  than  other  lots,  and  25  per  cent,  higher  in  the  resi- 
dential section.  In  New  York,  corner  lots  are  also  assessed 
higher  than  other  lots  in  accordance  with  a  fixed  percent- 
age. These  scales  vary  but  slightly  in  different  cities, 
probably  no  more  than  in  different  parts  of  the  same  city. 

53.  How  may  the  values  of  irregular  shaped  lots  be  accurately 

determined? 

In  order  to  compute  accurately  the  value  of  long  or  short 
lots  and  of  irregular  lots,  it  is  necessary  to  fix  values  for 
various  depths  from  the  street  front.  As  the  result  of 
experience,  several  tables  have  been  worked  out  in  various 
[34] 


cities  showing  the  values  (in  terms  of  percentage  of  the 
entire  value)  of  each  foot  in  depth  back  to  200  feet  or  more 
from  the  street.  By  applying  such  percentage  values,  the 
value  of  a  lot  of  any  depth  or  with  irregular  sides  is  easily 
obtained.  These  tables,  while  slightly  differing  in  various 
cities,  are  in  substantial  accord,  and  are  used  by  assessors 
to  the  great  saving  of  their  time  and  also  to  aid  uniformity 
of  assessment  of  the  land. 
54.  What  is  meant  by  the  Hoffman-Neill  rule  of  varying  depth 

and  state  where  and  how  it  is  used? 

The  Hoffman-Neill  rule  for  determining  the  value  of 
varying  depths  of  lots  is  used  in  New  York  city.  It  was 
first  promulgated  by  Judge  Murray  Hoffman  of  New 
York,  and  later  elaborated  by  Henry  Harmon  Neill. 
Taking  100  feet  as  the  unit  depth,  the  value  of  the  first 
50  feet  of  this  depth  is  considered  as  two-thirds  of  the 
value  of  the  whole.  From  this  as  a  starting  point  calcu- 
lations are  made  to  show  the  proportion  of  the  value  of 
each  foot  in  depth  to  the  value  of  the  whole  as  follows : 

HOFFMAN-NEILL  RULE 


FEET 

PER  CENT. 

FEET 

PER  CENT. 

FEET 

PER  CENT. 

FEET 

PER  CENT. 

I 

6.76 

26 

45-48 

51 

67-45 

76 

85.14 

2 

10.14 

27 

46.50 

52 

68.22 

77 

85-79 

3 

12.86 

28 

47-51 

53 

68.99 

78 

86.44 

4 

15.20 

29 

48-50 

54 

69.75 

79 

87.09 

5 

17.32 

30 

49-47 

55 

70.51 

80 

87.73 

6 

19.29 

31 

50.42 

56 

71.26 

81 

88.37 

7 

21.12 

32 

51.36 

57 

72.01 

82 

89.01 

8 

22.82 

33 

52.29 

58 

72.75 

83 

89.64 

9 

2443 

34 

53-21 

59 

7348 

84 

90.27 

10 

25.98 

35 

54.12 

60 

74.20 

85 

90.90 

ii 

27.48 

36 

55-01 

61 

74.92 

86 

91.53 

12 

28.93 

37 

55.89 

62 

75.63 

87 

92.16 

13 

30.33 

38 

56.76 

63 

76.34 

88 

92.78 

14 

31.68 

39 

57.63 

64 

77.04 

89 

93-40 

15 

32.98 

40 

58.49 

65 

77.74 

90 

94.01 

16 

34-24 

4i 

59-34 

66 

78.34 

9i 

94.62 

i? 

35-47 

42 

60.  1  8 

67 

79.12 

92 

95.23 

18 

36.67 

43 

61.02 

68 

79.81 

93 

95.83 

19 

37.84 

44 

61.85 

69 

80.49 

94 

96.43 

20 

38.99 

45 

62.67 

70 

81.17 

95 

97-03 

21 

4O.I2 

46 

63-48 

71 

81.85 

96 

97.63 

22 

41.23 

47 

64.29 

72 

82.51 

97 

98.23 

23 

42.32 

48 

65.09 

73 

83.17 

98 

98.82 

24 

43-39 

49 

65.88 

74 

83.83 

99 

99.41 

25 

44.44 

50 

66.67 

75 

84.49 

IOO 

IOO.OO 

[35 


A  convenient  rule,  in  common  use  in  New  York  city,  for 
the  determination  of  the  value  of  lots  of  greater  depth 
than  100  feet,  is  as  follows: 

For  the  first      25  feet  beyond  100  feet  add  9  per  cent. 
"      "    second  25    "          "        100    "       "    8    "      " 
"     "    third     25    "         "       100    "      "    7    "      " 
"      "    fourth  25    "          "        100    "       "    6    "      " 


The  following  examples  will  illustrate  the  method  of  com- 
puting the  value  of  each  of  three  lots  from  the  unit  value 
as  shown  on  a  land  value  map : 


t 

< 

1       - 

It.           44-"nn  «nt              ST  \T    oiu                  i 

7500                  5000           ?     2500 

9.9. 

863 

03  <£ 

863 

o  o 

0     0 

UJ 

>        883 

E.             33"° 

o  8 

ST 

0     10 

-3S03400 

o 

280^600 

I3°°I200 

862 
E.               32" 

o 
in 

CO 

8CZ 

ST. 

sg 

688 

3400 

2500 

1200 

10 

0  0 

x  - 

0 

fo 

861 
ST. 

coco 

*  •" 

3200                  2300                    1200 

860 

IE.        30" 

§ 

o»> 

CO 

860 
ST. 

oo 

e§ 

CO  CO 

886 

3000                2300 

1200 

853 

§ 

659 

§   0 

88S 

E.            29W 

CO 

ST 

CO   CO 

2900                  2200                    1200 

! 

w   •- 

"  o      E> 

34th  St. 
33rd  St. 
32nd  St. 
3ist  St. 
30th  St. 
2Qth  St. 

1600 

883 

oS| 
=          E. 

i( 

E. 

1C 

E. 
E. 

il[ 

E. 

I00°90o 

888 

.     900 

887 

900 

886 

900 

ess 

900 

SMALL  SECTION  OF  LAND  VALUE  MAP 

CALCULATION  OF  LAND  VALUE 
For  Lot  II. 

17  x  $1,200  equals  $20,400. 
This  lot  is  17  feet  wide  by  98.9  deep  (so 
nearly  100  feet  that  it  has  been  treated  as  a  full 
lot). 

Hence  the  assessed  land  value  of  $20,400. 


[36] 


E.    3F    ST. 


SMALL  SECTION  OF  BLOCK  AND  LOT  MAP  SHOWING  THREE  LOTS  IN  BLOCK 
NUMBER  887 ,  SHOWN  IN  PRECEDING  LAND  VALUE  MAP.  NOTICE  LOT  NUMBERS 
AND  EXACT  DIMENSIONS  OF  LOTS. 

For  Lot  12. 

2 1. 1  x  $1.200  equals  $25,300. 

But  the  lot  is  only  63  feet  deep ;  applying  the 
Hoffman-Neill  Rule,  we  multiply  $25,300  by 
76  per  cent.,  which  equals  $19,418. 

Hence  assessed  value  (in  round  figures), 
$19.400. 

For  Lot  13. 

21.1x98.9,   irregular. 
2 1. 1  x  $1,200  equals  $25,300. 
But  this  lot  includes  what  would  be  the  rear 

of  Lot  12,  if  that  lot  were  a  full  lot. 

This  rear  portion  is  worth  the  differ- 
ence between  the  value  of  a  full  lot, 

which  is $25,300 

and  the  value  of  that  portion  of  a 
full  lot  which  is  included  in  Lot  12, 
namely,  76  per  cent,  of  the  full  lot .  .  19,400 

Hence  the  value  of  the  rear  portion  is  .       5»9°° 

Add .  25,300 


[37] 


$31,200 


Assessed  value  of  Lot  13  is  $31,000,  because 
an  allowance  of  $200  has  been  made  on  the  rear 
portion  in  recognition  of  the  difficulty  of  using 
or  selling  it. 

55.  What  is  meant  by  the  Newark  rule? 

In  Newark  the  rule  used  for  determining  the  values  of 
varying  depths  differs  a  little  from  the  New  York  rule 
in  the  importance  given  to  various  parts  of  a  depth  of  100 
feet.  The  following  table  shows  the  percentages  of  values 
up  to  200  feet: 


BUSINESS  SECTION 

RESIDENTIAL  SECTION 

Feet  Deep 

Per  Cent,  erf 
Unit 

Feet  Deep 

Per  Cent,  of 
Unit 

IO 

25 

10 

16 

2O 

41 

20 

30 

30 

54 

30 

44 

40 

64 

40 

55 

50 

72 

50 

65 

60 

80 

60 

74 

70 

86 

70 

83 

80 

9i 

80 

9i 

90 

96 

90 

96 

IOO 

IOO 

IOO 

IOO 

no 

104 

no 

104 

1  20 

1  08 

120 

1  08 

130 

112 

130 

112 

140 

116 

140 

116 

150 

121 

150 

I2O 

160 

124 

1  60 

124 

170 

127 

170 

127 

1  80 

129 

1  80 

129 

190 

131 

190 

131 

200 

133 

200 

133 

Plus  1 6  per  cent,  for  each  additional  hundred  feet,  pro- 
vided the  conditions  do  not  warrant  it  being  assessed  from 
another  street. 


56.  What  is  the  Cleveland  rule  and  where  is  it  in  operation? 

The  standard  rule  used  in  Cleveland  gives  a  slightly 
greater  value  for  the  first  50  feet  than  does  the  Hoffman- 
Neill  rule.  Tables  have  been  computed  showing  foot 
values  to  700  feet,  as  follows : 

[38] 


PERCENTAGE  OF  UNIT  VALUE  FOR  LOTS  FROM  i  TO 
700  FEET  DEEP 


DEPTH 

PER 

DEPTH 

PER 

DEPTH 

PER 

DEPTH 

PER 

DEPTH 

PER 

FEET 

CENT. 

FEET 

CENT. 

FEET 

CENT. 

FEET 

CENT. 

FEET 

CENT. 

50 

72.50 

IOO 

IOO.OO 

150 

115.00 

20O 

I22.OO 

I 

3-io 

I 

72.25 

I 

100.41 

I 

115.19 

I 

122.00 

2 

6.10 

2 

74.00 

2 

100.85 

2 

H5.38 

2 

122.  2O 

3 

9.00 

3 

74-75 

3 

IOI.27 

3 

115-57 

3 

122.30 

4 

U-75 

4 

75-50 

4 

101.70 

4 

115.76 

4 

122.40 

5 

14-35 

5 

76.2O 

5 

102.08 

5 

U5.95 

\J  S\J 

5 

122.50 

6 

16.75 

6 

76.90 

6 

102.48 

6 

II6.I2 

2IO 

122.95 

7 

19.05 

7 

77-55 

7 

102.88 

7 

116.29 

15 

123.38 

8 

21.20 

8 

78.20 

8 

103-25 

8 

116.46 

20 

123.80 

9 

23.20 

9 

78.85 

9 

103.62 

9 

116.62 

30 

124.60 

10 

25.00 

60 

79.50 

no 

104.00 

1  60 

116.80 

240 

125.35 

i 

26.70 

i 

80.  1  1 

i 

104.36 

i 

116.96 

50 

126.05 

2 

28.36 

2 

80.77 

2 

104.72 

2 

117.13 

60 

126.75 

3 

29.99 

3 

81.38 

3 

105.08 

3 

117.30 

70 

127.40 

4 

3I.6I 

4 

82.OO 

4 

105-43 

4 

117.47 

80 

128.05 

5 

33-22 

5 

82.61 

5 

105.78 

5 

117.64 

90 

128.65 

6 

34-92 

6 

83.21 

6 

106.13 

6 

117.79 

300 

129.25 

7 

36.41 

7 

83.82 

7 

106.47 

7 

117.94 

IO 

129.80 

8 

37.97 

8 

84.42 

8 

106.81 

8 

118.09 

2O 

130.35 

9 

39-50 

9 

85.01 

9 

107.15 

9 

118.24 

30 

130.90 

20 

4I.OO 

70 

85.60 

I2O 

107.50 

170 

118.40 

340 

131.40 

I 

42.50 

i 

86.15 

I 

107.80 

i 

118.54 

50 

131.90 

2 

43.96 

2 

86.70 

2 

108.11 

2 

118.70 

60 

132.40 

3 

45.30 

3 

87.24 

3 

108.43 

3 

118.85 

70 

132.85 

4 

46.61 

4 

87.78 

4 

108.75 

4 

119.00 

80 

133.30 

5 

47.90 

5 

88.30 

5 

109.05 

5 

119.14 

90 

133.75 

6 

49-17 

6 

88.82 

6 

109.35 

6 

119.28 

400 

134.20 

7 

50.40 

7 

89.35 

7 

109.65 

7 

119.41 

IO 

134.60 

8 

5I.6I 

8 

89.87 

8 

109.93 

8 

H9.54 

20 

135-00 

9 

52.81 

9 

90.39 

9 

110.21 

9 

119.67 

30 

13540 

30 

54-00 

80 

90.90 

130 

110.50 

1  80 

119.80 

440 

135.80 

i 

55-05 

i 

91-39 

i 

IIO.76 

I 

119.92 

50 

136.15 

2 

56.10 

2 

91.89 

2 

III.  O2 

2 

120.05 

60 

136.50 

3 

57.15 

3 

92.38 

3 

111.28 

3 

120.18 

70 

136.85 

4 

58.20 

4 

92.86 

4 

111-55 

4 

120.31 

80 

137.20 

5 

59-20 

5 

93.33 

5 

III.8O 

5 

120.43 

90 

137-55 

6 

60.30 

6 

93.80 

6 

112.05 

6 

120.55 

500 

137.85 

7 

61.25 

7 

94-27 

7 

112.28 

7 

1  20.66 

IO 

138.15 

8 

62.20 

8 

94.73 

8 

112.52 

8 

120.77 

20 

138.45 

9 

63.10 

9 

95.17 

9 

112.76 

9 

120.88 

30 

138.75 

40 

64.00 

90 

95.60 

140 

113.00 

190 

121.00 

540 

139.05 

i 

64-95 

i 

96.04 

i 

113.20 

i 

121.  10 

50 

I39.30 

2 

65-90 

2 

96.50 

2 

II343 

2 

121.  21 

60 

139-55 

3 

66.75 

3 

96.95 

3 

113.64 

3 

121.32 

70 

139.80 

4 

67.60 

4 

9740 

4 

H3.85 

4 

121.43 

80 

140.05 

5 

68.45 

5 

97.85 

5 

H4.05 

5 

121-53 

600 

140.55 

6 

69-30 

6 

98.30 

6 

H4.25 

6 

121.62 

20 

140.95 

7 

70.10 

7 

98.74 

7 

114-45 

7 

121.71 

40 

I4L35 

8 

70.90 

8 

99.17 

8 

114.64 

8 

121.80 

60 

I4L75 

9 

71.70 

9 

99.58 

9 

114.82 

9 

121.90 

80 

142.05 

50 

72.50 

IOO 

100.00 

150 

115.00 

200 

1  22.0O 

7OO 

142.35 

39 


The  Cleveland  rule  is  also  used  in  Springfield,  East  St. 
Louis,  St.  Louis,  and  Joliet,  111.;  Houston  and  Beaumont, 
Texas;  and  five  or  six  other  cities  of  lesser  importance. 

57.  What  other  rule  has  been  devised  to  determine  land  values 

of  varying  depths? 

Tables  used  in  Baltimore,  where  the  normal  lot  depth  is 
150  feet,  show  the  percentage  which  a  lot  shorter  than  150 
feet  bears  to  the  standard  size  and  the  additional  value  of 
a  deeper  lot  up  to  200  feet.  The  value  of  the  last  100  feet 
in  a  lot  200  feet  in  depth  is  made  practically  20  per  cent. 
of  that  of  the  first  100  feet.  As  to  the  front  50  feet  there 
is  little  deviation  from  the  Hoffman-Neill  rule. 

58.  If  one  of  the  above  rules  were  incorporated  as  a  part  of  the 

new  system  suggested  for  Philadelphia,  would  there  still 
be  room  for  the  exercise  of  judgment  on  the  part  of  the 
individual  assessor? 

Yes.  The  assessor  would  still  have  to  use  his  own  judg- 
ment to  a  certain  extent,  backed  by  all  available  informa- 
tion, in  fixing  unit  values,  in  making  allowances  for  pe- 
culiar shapes  of  lots  that  might  affect  their  desirability 
for  a  buyer,  in  making  allowances  for  lots  off  grade,  in  de- 
termining depreciation  or  appreciation,  etc. 

59.  If  the  judgment  of  the  individual  assessor  plays  such  an 

essential  part  in  the  assessment  of  real  estate,  why 
then  are  block  and  lot  maps,  land  value  maps,  etc.,  of 
so  much  importance? 

Because  even  though  a  strictly  "scientific"  method  of 
assessment,  eliminating  entirely  the  judgment  of  the  in- 
dividual assessor,  is  an  impossibility,  nevertheless,  every- 
thing which  tends  toward  uniformity  and  accuracy  of 
method  in  assessing  real  estate,  makes  more  probable 
equalization  of  assessment  as  between  the  various  proper- 
ties assessed,  and  is  to  that  extent  desirable.  The  use  of 
block  and  lot  maps  and  land  value  maps,  as  well  as  of 
"factors  of  value  of  new  buildings"  hereinafter  described, 
has  a  marked  influence  toward  standardizing  the  work  of 
the  different  assessors.  Their  usefulness,  therefore,  can- 
not be  questioned. 

60.  Should  unimproved  land  in  an  improved  section  of  the  city 

be  assessed  at  the  same  value  as  adjoining  improved 
land,  less,  of  course,  the  value  of  the  improvements? 
[40] 


Yes.  The  law  provides  that  all  real  estate  be  assessed  at 
its  full  value,  not  upon  the  basis  of  what  its  owner  may 
see  fit  to  cause  it  to  earn.  Moreover,  the  value  of  unim- 
proved land  in  an  improved  section  is  largely  created  by 
the  improvements  in  the  section  in  which  it  lies.  It  is, 
therefore,  only  just  that  such  land  should  be  assessed  at 
the  same  rate  as  that  which  applies  to  the  surrounding 
land. 

61.  Where  has  this  practice  been  followed  and  with  what  results? 

Such  a  plan  has  been  in  effect  for  many  years  in  New 
York  City  and  many  other  cities  where  land  is  separately 
assessed.  As  a  result  of  its  application,  assessments  have 
become  more  equitable  and  vacant  lots  in  business  centers 
and  other  districts  highly  improved  have  almost  entirely 
disappeared,  for  it  is  no  longer  profitable  to  buy  realty 
with  no  intention  of  improving  it  but  merely  to  hold  for 
increased  values. 

62.  When  it  is  necessary  for  the  city  to  acquire  certain  land  for 

public  use  and  when  such  public  use  will  enhance  the 
value  of  the  surrounding  land,  is  it  proper  to  assess  such 
land  to  be  taken  at  the  enhanced  value  of  the  surround- 
ing land? 

No.  The  value  of  the  land  to  be  acquired  by  the  city  is 
not  increased  and  the  assessed  value  should  not  be  ad- 
vanced. The  surrounding  land,  however,  should  be  as- 
sessed at  its  full  value  as  enhanced  by  the  prospective 
public  use. 

FACTORS  OF  VALUE  OF  BUILDINGS 

63.  What  tools  in  the  nature  of  standards  of  value  can  be  fur- 

nished assessors  for  use  in  assessing  buildings  and  im- 
provements as  distinct  from  land  itself? 

The  most  important  aids  of  this  character  are  the  so-called 

"factors  of  value  of  new  buildings." 

64.  What  are  factors  of  value  of  new  buildings,  how  are  they 

determined,  and  how  are  they  used  in  estimating  the 
value  of  a  particular  building  for  purposes  of  assess- 
ment? 

Architects  and  builders  have  ascertained  that  in  many  in- 
stances there  is  a  more  or  less  definite  relationship  between 
[41] 


the  construction  cost  of  a  building  and  the  number  of 
square  feet  of  floor  space  (disregarding  air  shafts  and  ir- 
regularities) in  the  building.  Therefore,  if  the  construc- 
tion cost  of  a  particular  building  per  square  foot  of  floor 
space  has  been  determined,  by  dividing  the  total  con- 
struction cost  of  the  building  by  the  number  of  square  feet 
of  floor  space  therein,  then  the  construction  cost  of  any 
other  building  of  the  same  general  character,  i.  e.,  differing 
fundamentally  only  in  the  matter  of  size,  may  be  more  or 
less  accurately  determined  by  multiplying  the  number  of 
square  feet  of  floor  space  therein  by  the  construction  cost 
per  square  foot  of  floor  space  of  the  first  mentioned  build- 
ing. Architects  and  builders  generally  estimate  the  cost 
of  a  building  by  its  cost  per  cubic  foot  of  contents,  count- 
ing from  the  bottom  of  the  excavation  to  the  top  of  the 
building.  This  system  is  hardly  practicable  for  assessors, 
who  frequently  find  it  difficult  to  obtain  the  required  in- 
formation as  to  the  height  of  buildings  or  their  depth 
below  the  level  of  the  street.  It  is  practicable,  however, 
for  assessors  to  determine  with  substantial  accuracy  the 
number  of  square  feet  of  floor  surface  on  each  floor  and  the 
number  of  floors.  For  present  purposes,  therefore,  fac- 
tors of  value  may  be  defined  as  the  construction  cost  of  a 
building  per  square  foot  of  floor  space. 
Where  such  factors  of  value  are  in  use,  buildings  are 
classified,  so  far  as  seems  practicable,  into  various  groups 
or  classes,  as  for  example : 

Dwellings: 

2  to  2^2  story  frame  houses  without  improvements 

2  to  2^£  story  frame  houses  with  improvements 

3  to  4      story  brick  houses  without  improvements 
3  to  4      story  brick  houses  with  improvements 


Very  costly  dwellings, 

Modern  hotels, 

Warehouses, 

Office-buildings, 

Department  stores, 

Factories, 

Stables, 

Garages, 


Each  with  various  subclassifica- 
tions,  as  partially  illustrated 
above  in  the  case  of  dwellings. 


Then  by  careful  investigation  the  factor  of  value  for  each 
particular  class  is  determined,  and  a  general  table  setting 

[42] 


forth  the   factors  of  value  for  all  the  various  classes  is 
prepared  for  the  use  of  assessors. 

Of  course,  all  such  factors  must  be  constantly  subject  to 
examination  and  modification  to  meet  changes  in  condi- 
tions. They  are  intended  not  to  control  but  merely  to 
assist  the  judgment  of  an  assessor  in  reaching  well-informed 
conclusions.  Moreover,  these  factors  of  value  are  merely 
of  assistance  in  arriving  at  the  construction  cost  of  a  build- 
ing, and,  therefore,  after  this  construction  cost  has  been 
ascertained,  the  judgment  of  the  individual  assessor  still 
has  to  be  called  into  play  in  considering  the  effect  of  age, 
changes'in  the  character  of  the  neighborhood,  rental  value, 
etc.  Without  consideration  of  these  elements  the  value 
of  a  building  at  any  particular  time  cannot  be  fairly  deter- 
mined. The  fact  remains  that  a  method  which  enables 
assessors  throughout  the  city  to  ascertain  with  a  fair  degree 
of  accuracy,  before  their  individual  judgment  comes  into 
play  to  any  great  extent,  the  construction  cost  of  a  building, 
greatly  reduces  the  probability  of  unequalized  assessments. 
65.  In  arriving  at  assessment  values,  to  what  extent  should  earn- 
ing capacity  be  given  consideration? 
If  improved  property  cannot  be  rented,  it  indicates  that 
the  building  is  unsuitable  and  has  substantially  no  value, 
or  it  indicates  a  very  serious  decline  in  land  value.  The 
important  question  is  whether  the  building  is  thoroughly 
suitable.  For  example,  a  case  could  be  shown  of  a  building 
that  remained  untenanted  in  spite  of  great  effort  to  rent  it 
until  another  man  bought  the  property,  made  slight  changes 
at  small  expense,  and  filled  his  building  with  tenants. 
In  estimating  the  value  of  a  property  long  improved 
where  deterioration  and  obsolescence  are  difficult  to  de- 
termine, the  earning  capacity  should  always  be  considered. 
The  New  York  city  rule  is:  That  a  plot  of  land  and  the 
building  on  it  that  is  used  as  a  revenue-producing  property 
is  worth  at  least  the  net  rental  capitalized  at  a  suitable 
rate  per  cent. ;  and  that  this  is  the  best  test  of  the  value 
of  the  whole,  unless  the  land  alone  is  worth  more  than  this 
amount;  and  that  the  whole  is  never  worth  more  than  the 
net  rental  capitalized  at  a  suitable  rate  per  cent,  until  the 
land  alone  exceeds  in  value  this  capitalized  sum. 
[43] 


For  example,  many  a  case  could  be  shown  of  a  building, 
when  first  erected  twenty-five  years  ago,  that  returned  to 
the  owners  a  gross  rent  of  $20,000.  The  property  as  a 
whole  was  worth  $200,000.  Today,  the  gross  rent  is  about 
$19,000.  The  owners  have  managed  with  a  great  deal  of 
effort  and  care  to  keep  their  rent  roll  at  almost  the  same 
figure,  although  the  neighborhood  has  been  changing,  and 
better  business  houses  have  been  constructed  all  around. 
The  land  is  now  worth  about  $160,000,  as  against  perhaps 
$75,000  twenty-five  years  ago.  The  total  value  has  re- 
mained the  same,  and  the  land  has  been  going  up,  up,  up, 
and  it  may  be  in  a  few  years  that  the  land  will  come  to  be 
level  in  value  to  the  original  value  of  the  whole  property, 
and  then  the  old  building  ought  to  come  down.  To-day 
the  building  is  worth  something,  perhaps  $40,000,  or  the 
total  value  is  the  capitalized  rent  to-day,  just  as  it  was 
twenty-five  years  ago.  This  illustrates  how  the  land 
creeps  up  on  the  building  as  the  building  becomes  value- 
less. 

66.  In  the  case  of  a  building  which  through  depreciation  becomes 
obsolescent,  how  can  the  assessor  determine  how  much 
shall  be  cut  down  from  the  cost  of  reproduction  of  the 
building  in  order  to  give  a  fair  valuation  of  the  property? 
Every  building  depreciates  year  by  year  until  it  loses  all 
value,  and  the  assessor  must  take  account  of  this  fact. 
After  it  has  become  obsolete  it  may  stand  for  a  hundred 
years  or  more,  but  nobody  would  pay  anything  more  for 
the  land  because  of  the  building.  The  improved  methods 
of  building  are  such  that  an  appropriate  structure  may 
now  often  be  erected  on  modern  plans  for  much  less  than 
it  formerly  cost  for  a  building  to  serve  the  same  purpose 
less  efficiently.  Under  these  circumstances  an  old-style 
building  in  good  repair  can  be  worth  no  more  than  a 
modern  building  costing  much  less  which  serves  the  same 
purpose  equally  well.  So  it  requires  a  large  degree  of 
judgment  to  determine  how  much  shall  be  cut  down  from 
the  cost  of  reproduction  in  order  to  give  a  fair  valuation 
for  the  property.  It  should  be  borne  in  mind  that  this 
very  reduction  in  cost  of  construction  often  tends  strongly 
to  enhance  the  value  of  land. 
[44] 


Sometimes  even  a  new  building  will  be  built  in  such  a 
foolish  way  that  it  is  worth  less  than  its  actual  cost.  For 
example,  an  apartment  house,  where  the  rooms  are  so 
small  and  the  halls  so  narrow  that  they  cannot  be  rented 
profitably,  is  actually  worth  less  than  the  cost  of  a  proper 
kind  of  new  building  would  be. 

In  Philadelphia  there  are  many  buildings  which  although 
rented  and  occupied  add  nothing  to  the  value  of  the  ground 
on  which  they  stand.  In  New  York,  such  buildings  have 
levied  on  them  an  assessment  equal  to  about  one  year's 
rental,  on  the  theory  that  when  the  parcel  is  bought  for 
improvement  it  takes  some  months  to  prepare  plans  to 
get  ready  for  the  erection  of  a  new  and  suitable  building, 
and  during  that  time  the  old  building  is  a  revenue  pro- 
ducer. The  cost  of  reproduction  of  such  a  building  is  not 
taken  into  account  at  all. 

67.  How  should  buildings  in  the  course  of  construction  be 

assessed? 

In  New  York  city  the  old  rule  for  assessing  buildings  in 
course  of  construction  was  the  same  as  the  present  prac- 
tice in  Philadelphia,  whereby  the  assessor  attempts  to 
compute  the  sum  expended  in  construction  on  the  un- 
finished buildings  up  to  the  date  when  the  assessment 
rolls  are  completed,  this  amount  being  thereupon  reported 
as  the  assessment  on  the  buildings  in  question. 
The  new  rule,  just  adopted  in  New  York,  is  that,  "A 
building  in  course  of  construction,  commenced  since  the 
preceding  first  day  of  October  and  not  ready  for  occu- 
pancy, shall  not  be  assessed."  Since  the  annual  record 
of  the  assessed  valuation  of  real  estate  is  opened  for  public 
inspection  on  October  1st,  this  rule  virtually  allows  a 
maximum  limit  of  one  year  for  the  construction  of  a 
building,  and  if  the  building  is  not  ready  for  occupancy 
within  that  period,  it  is  not  assessed. 

TRUE  CONSIDERATION  TO  BE  STATED  IN  DEEDS 

68.  If  it  is  true  that  assessors  form  their  judgments  as  to  values 

to  a  large  extent  by  a  consideration  of  sales,  how  then 
are  they  to  learn  of  the  terms  of  sales? 
The  law  requires  assessments  to  be  made  at  the  true 
145] 


market  value  or  the  sum  for  which  the  property  would  sell 
under  ordinary  circumstances.  The  assessor  must  not 
guess  at  values,  he  must  not  put  down  what  he  thinks  they 
may  be  or  ought  to  be,  but  what  they  are.  The  value  of 
real  estate  is  what  the  community  thinks  it  is  worth,  as 
evidenced  by  what  men  buy  and  sell  it  for.  Selling  prices, 
however,  cannot  always  be  relied  upon  by  an  assessor  as  a 
just  figure  at  which  to  assess  a  particular  property,  be- 
cause a  sale  may  only  represent  the  opinion  of  the  buyer 
and  the  seller  as  to  the  value  of  the  property.  For 
example,  necessity  may  compel  the  sale  of  a  property  for 
much  less  than  it  would  ordinarily  bring,  so  selling  prices 
can  only  be  counted  upon  as  one  of  the  many  indications 
of  value  which  should  be  considered  in  arriving  at  assess- 
ments. 

In  nearly  all  deeds,  however,  the  true  value  given  for 
property  is  concealed  by  stating  the  consideration  to  be 
"nominal"  or  "one  dollar  and  other  good  and  valuable 
consideration,"  or  by  some  other  subterfuge,  such  as  stat- 
ing a  small  sum  which  is  known  to  be  nowhere  near  what 
the  property  is  worth.  An  assessor  depending  upon  such 
meagre  and  untruthful  information  is  handicapped  in  his 
endeavor  to  make  fair  and  equal  assessments,  and  it  is 
therefore  greatly  to  be  desired  that  a  law  be  passed,  re- 
quiring the  true  consideration  to  be  recorded  in  all  deeds 
transferring  real  estate. 

When  the  true  consideration  in  all  deeds  is  known  to  an 
assessor,  it  will  be  easy  to  make  fair  and  full  assessments 
arid  hard  to  make  them  otherwise. 

ASSESSORS'  FIELD  BOOKS 

69.  What  further  tools  should  be  placed  at  the  disposal  of  as- 

sessors? 

The  most  approved  and  convenient  form  of  assessor's 
"Field  Book." 

70.  What  is  an  assessor's  "Field  Book";   and  what  sort  of  in- 

formation should  be  provided  for  in  such  a  book? 
The  assessor's  field  book  is  a  book  to  be  used  by  an  as- 
sessor for  the  purpose  of  recording  and  classifying  all 
information  and  evidence  of  value  possible  for  him  to  ob- 
[46] 


tain  that  would  help  to  determine  assessments.  Such  a 
book  should  provide  suitable  columns  or  space  for  the 
following  entries : 

a.  Name  of  owner  or  occupant 

b.  Size  of  lot 

c.  Number  of  houses  on  lot 

d.  Size  of  each  house 

e.  Number  of  stories  high 

f .  The  street  number 

g.  The  section,  block  and  lot  numbers 

h.    The  value  of  the  real  estate  unimproved  for  two  con- 
secutive years 

i.     The  final  assessed  value  for  six  consecutive  years 
j.     Conveyances,  with  the  consideration  if  known 
k.    Mortgages,  with  the  names  of  the  institutions  lending 
the  money,  if  the  institution  is  one  limited  by  law  to 
loans  not  in  excess  of  a  certain  percentage  of  the  market 
value 

1.     Recorded  leases  with  the  period  and  rental 
m.  Remarks  and  any  other  data,  or  confidential  informa- 
tion, which  may  be  indicative  of  value 
In  addition  to  the  field  book,  a  card  system  may  be  em- 
ployed to  supplement  the  information  recorded  in  the 
field  book,  and  ordinary  scrap  books  are  frequently  found 
to  be  useful  tools  for  preserving  newspaper  clippings,  etc. 
Field  books  should  be  bound  in  permanent  form  and  pre- 
served a  reasonable  length  of  time. 

71.  Should  assessors1  field  books  be  open  to  public  inspection? 

So  far  as  practicable,  but  not  necessarily  as  a  matter  of 
right. 

72.  When  changes  are  made  in  assessments,  should  the  reasons 

therefor  be  preserved  in  permanent  form? 
An  assessor's  reasons  for  changing  assessed  values  should 
be  shown  by  the  memoranda  in  the  field  books.  If  appli- 
cations are  made  for  the  reduction  of  an  assessment,  the 
application  should  be  preserved  together  with  the  report 
of  the  assessor. 

73.  Should  such  reasons  be  open  to  public  inspection? 

So  far  as  practicable,  but  not  necessarily  as  a  matter  of 
right. 

[471 


74.  Should  the  records  of  all  available  sales,  transfers,  mort- 

gages, leases,  etc.,  be  preserved  in  permanent  form? 
Yes. 

75.  Should  such  records  be  open  to  public  inspection? 

So  far  as  practicable,  but  not  necessarily  as  a  matter  of 
right. 

COMMUNICATION  WITH  PUBLIC 

76.  What  information  should  assessment  notices  contain  and 

how  should  they  be  issued? 

After  the  annual  assessments  of  all  properties  have  been 
completed,  assessment  notices  might  be  sent  to  each  tax- 
payer, showing: 

a.  The  location  of  the  property 

b.  Assessment  section  number 

c.  Block  and  lot  number 

d.  Amount  of  the  assessment  on  land 

e.  Amount  of  the  assessment  on  improvements 

f.  Amount  of  the  total  assessment  on  the  property 

g.  Date  when  hearings  for  reductions  will  be  made 
Theoretically,  there  can  be  no  doubt  as  to  the  desirability 
of  sending  out  such  notices;  practically,  however,  it  is 
perhaps  an  open  question  whether  to  do  so  would  entail 
too  much  labor  and  expense      It  is  not  done  in  New  York 
city 

77.  What  other  formal  communications  should  be  sent  to  tax- 

payers who  appeal  for  reductions? 

In  addition  to  the  assessment  notices,  taxpayers  should 
be  formally  notified  regarding  the  final  action  of  the  Board 
of  Revision  on  claims  for  reductions. 

SYSTEMATIC  PUBLICITY 

78.  Supposing  that  all  real  estate  is  assessed  at  its  full  value; 

that  the  assessment  system  embraces  the  principles  of 
separate  assessments  on  land  and  improvements;  that 
the  members  of  the  Board  of  Revision,  the  assessors, 
and  the  clerks,  are  men  chosen  for  their  fitness  and  are 
under  the  control  of  the  taxpayers ;  that  the  department 
is  equipped  with  the  proper  tools,  such  as  block  and  lot 
maps,  land  value  maps,  and  factors  of  value  of  new 
[48] 


buildings;    what  still  remains  necessary  to  make  the 

system  efficient? 

Systematic  publicity.  It  is  important  that  every  tax- 
payer be  enabled  to  understand,  not  only  the  amount  at 
which  his  property  is  assessed,  but  how  this  assessment  is 
arrived  at.  Where  the  methods  heretofore  indicated  are 
in  use  it  has  been  found  that  if  a  taxpayer  may  have  in  his 
own  possession  a  land  value  map  covering  the  neighbor- 
hood in  which  his  property  is  situated,  and  a  printed  list, 
geographically  arranged,  of  the  exact  amounts  at  which 
all  land  and  the  buildings  and  improvements  thereon  in 
such  neighborhood  are  assessed,  it  is  a  comparatively  easy 
matter  for  any  intelligent  man  to  check  up  on  the  work  of 
the  assessors.  This  of  itself  prevents  a  vast  number  of 
appeals.  It  tends  to  give  taxpayers  confidence  in  the 
assessors.  It  awakens  a  realization  that  all  property  own- 
ers are  being  fairly  and  equally  treated. 

79.  Should  block  and  lot  maps  be  published  annually  for  general 

distribution? 
No.     This  would  be  both  unnecessary  and  expensive. 

80.  Should  land  value  maps  be  published  annually  for  general 

distribution? 

Yes.  The  land  value  maps  of  each  section  of  the  city 
should  be  published  in  separate  pamphlets  and  in  suf- 
ficient numbers  to  meet  a  proper  and  reasonable  demand. 
This  can  be  done  without  excessive  expense  and  is  done 
to-day  in  a  number  of  cities,  including  New  York.  Such 
maps  should  be  published  before  assessments  have  been 
completed,  so  that  the  taxpayers  may  have  the  benefit  of 
them  before  the  assessors  have  reached  their  final  con- 
clusions. The  time  to  equalize  assessments  is  when  the 
assessments  are  being  made  and  not  afterward. 

81.  Should  a  complete  list  of  the  assessed  valuations  of  all  real 

estate  in  the  city  be  published  annually? 
Yes.  Such  a  policy  has  met  with  success  in  New  York 
and  is  an  admirable  method  of  publicity.  The  publica- 
tion, however,  should  take  the  form  of  a  series  of  pamph- 
lets, each  pamphlet  containing  a  particular  assessment  dis- 
trict. This  enables  any  one  who  is  interested  to  secure  the 
assessment  roll  of  any  particular  section  for  purposes  of 
[49] 


study.  If  the  assessors  are  doing  good  work,  the  tax- 
payers will  learn  of  it  and  this  in  turn  makes  the  assessors' 
lives  reasonably  contented.  If  they  are  not  doing  good 
work,  the  criticism  will  be  intelligent  because  it  will  be 
focused  on  particular  items  which  can  be  corrected. 

82.  What  information  as  to  each  property  should  be  included  in 

these  pamphlets? 
Such  pamphlets  should  contain  the  following  information : 

a.  The  name  of  the  owner  or  occupant 

b.  Size  of  lot 

c.  Number  of  stories  in  the  building 

d.  Street  number 

e.  Section,  block  and  lot  numbers 

f.  Value  of  real  estate  unimproved 

g.  Value  of  real  estate  with  improvement  thereon 

83.  What  other  records  connected  with  the  assessment  of  real 

estate  should  be  preserved,  and  to  what  extent  should 
such  additional  records  be  open  to  public  inspection? 
All  records  of  any  sort  whatsoever  connected  with  the 
assessment  of  real  estate  should  be  preserved  for  a  period 
of  years  in  the  offices  of  the  department.  This  includes 
the  assessors'  field  books,  assessors'  office  records,  block 
and  lot  maps,  land  value  maps,  assessment  rolls,  etc. 
These  records  last  referred  to,  except  perhaps  the  assessors' 
field  books,  should  be  open  to  public  inspection  at  all 
reasonable  hours. 

84.  What  is  the  final  element  in  systematic  publicity  relating 

to  realty  assessment? 

The  publication  of  an  annual  report  of  the  department  for 
general  distribution,  including  the  following  subjects: 

a.  The  organization  and  personnel  of  the  assessing  body 

b.  A  detailed  description  of  the  method  of  assessment 
(this  need  only  be  published  at  intervals) 

c.  A  complete  analysis  of  the  various  valuations  by  dis- 
tricts 

d.  Separate  statements  in  regard  to  the  increase  or  de- 
crease of  land  and  improvement  valuations,  arranged 
by  districts 

e.  Aggregate  assessments  for  past  and  current  years  in 
parallel  columns 

[50] 


f .  Tax  rate  for  past  and  current  years  in  parallel  columns 

g.  A  statement  of  all  forms  and  amounts  of  taxable  prop- 
erty and  exemptions 

h.  A  statement  as  to  the  total  number  of  assessments 
made  and  the  cost  of  each  assessment 

i.  A  brief  and  business-like  balance  sheet  showing  receipts 
and  expenditures  of  the  department,  etc. 

j .  A  summary  of  any  new  tax  legislation  of  interest  to  city 
taxpayers 

k.  A  summary  of  recent  ordinances  or  resolutions  of  coun- 
cils and  of  city  solicitor's  and  city  controller's  opinions 
affecting  the  work  of  the  assessing  body 

1.  Suggestions  as  to  more  efficient  methods  of  carrying  on 
the  work  of  the  department 


IX.  BENEFITS  OF  PROPOSED  ASSESSMENT  SYSTEM 

85.  Does  the  past  experience  of  other  cities  justify  the  immediate 

introduction  in  Philadelphia  of  such  a  system? 
The  suggested  improvements  are  not  the  whims  or  foibles 
of  inexperienced  students  or  theorists,  but  methods  which 
have  been  tested  and  tried  out  in  a  large  number  of  cities 
in  this  and  other  countries.  Practically  all  of  them  are  in 
use  to-day  in  New  York  city.  In  view  of  the  fact  that 
there  is  no  city  in  the  United  States  or,  for  that  matter, 
in  the  world,  with  the  exception  of  London,  where  prop- 
erty is  so  valuable  as  in  New  York,  nor  any  city  where 
there  are  so  many  separate  parcels  of  land  to  be  assessed, 
the  success  in  New  York  of  the  system  suggested,  since 
its  introduction  in  1906,  and  the  local  support  given  it  by 
practically  all  the  important  real  estate  men  in  New  York, 
is  very  significant.  Fortunately,  most  of  these  improve- 
ments can  be  introduced  in  Philadelphia  without  any  ad- 
ditional legislation  other  than  the  appropriation  of  the 
necessary  money  by  councils. 

86.  Should  the  introduction  of  such  an  assessment  system  as 

the  one  proposed  be  a  cause  for  alarm  on  the  part  of 

business  interests? 

No.     Business  interests  have  generally  been  found  to 
welcome  the  replacement  of  an  uncertain  method  of  as- 
[51] 


sessment  by  a  method  that  tends  to  insure  accuracy  and 
equalization.  Extreme  fluctuations  in  values  largely  dis- 
appear under  such  a  method  and  the  element  of  uncer- 
tainty is  thus  to  a  large  extent  removed. 

87.  Is  there  reason  to  believe  that  capital  for  investment  in  real 

estate  would  be  attracted  to  Philadelphia  from  other 
money  centers,  provided  a  system  of  assessing  realty 
should  be  introduced  into  this  city  such  as  would  stand- 
ardize land  values  and  equalize  assessments? 
Yes. 

88.  What  would  be  the  probable  results  of  the  introduction  of 

such  a  system  on  the  borrowing  capacity  and  current 

revenues  of  the  city? 

In  those  cities  which  have  established  systems  of  realty 
assessment  embracing  the  main  features  enumerated 
above,  experience  has  proved  that  prior  to  the  introduc- 
tion of  such  systems,  there  seemed  to  be  a  more  or  less 
universal  tendency  to  the  under-assessment  of  property. 
With  the  institution  of  this  system,  however,  the  result 
in  each  of  these  cities  has  been  that  the  total  assessment 
roll  has  been  materially  increased,  thus  adding  both  to  the 
borrowing  capacity  and  current  revenue. 
Should  the  suggested  system  be  adopted  in  Philadelphia, 
there  is  reason  to  believe  that  there  would  be  a  similar 
experience  here,  resulting  both  in  increased  borrowing 
capacity  and  in  increased  current  revenue. 

89.  Illustrate  the  use  of  such  a  system  in  meeting  claims  for 

reduction? 

A  taxpayer  comes  before  the  Board  of  Revision  and  says : 
"Gentlemen,  I  have  studied  the  land  value  map  covering 
my  section,  have  noted  on  the  published  assessment  list 
the  land  values  which  you  have  placed  on  my  property  and 
the  properties  adjoining  it,  and  I  feel  that  you  have 
valued  my  land  too  high.  In  the  first  place,  the  unit 
value  for  the  square  in  which  my  lot  is  situated  is  too 
high."  The  Board  thereupon  gets  out  the  land  value  map 
in  question  and  the  complainant  points  out  to  them  an- 
other square  in  the  same  general  neighborhood  where  he 
believes  that  the  values  should  be  just  about  the  same  as 
on  the  square  in  which  he  lives  and  shows  the  Board  that 
[52] 


the  unit  value  of  this  other  square  is  one  hundred  dollars 
less  than  that  of  the  square  in  which  his  lot  is  situated. 
Two  questions  are  then  definitely  presented  to  the  Board 
for  explanation  and  answer:  First,  are  these  two  squares 
made  up  of  lots  of  about  the  same  value?  If  so,  which 
value  is  correct?  These  are  practical,  definite  questions 
about  which  there  can  be  intelligent  discussion.  When 
they  have  been  disposed  of,  the  complainant  next  says  to 
the  Board: 

"Even  assuming  that  your  unit  value  for  my  square  is 
right,  the  assessment  on  my  particular  land  is  too  high. 
Look  at  the  land  value  which  you  have  placed  on  the  lot 
next  but  one  to  mine.  The  area  of  the  two  lots  is  practi- 
cally the  same.  The  frontage  is  the  same.  Why  have 
you  assessed  that  land  five  hundred  dollars  less  than 
mine?"  To  this  the  Board  replies:  "If  you  will  notice 
the  relation  between  the  grade  of  the  street  on  the  square 
in  which  you  live  and  the  grade  of  the  various  properties, 
you  will  see  that  your  property  is  on  exactly  the  same  grade 
or  level  as  that  of  the  street;  on  the  other  hand,  the  prop- 
erty two  lots  below  you,  to  which  you  refer,  is  consider- 
ably below  the  level  of  the  street  and  can  never  be  im- 
proved advantageously  without  large  expenditure  for 
filling  in,  etc.  Under  these  circumstances  we  think  our 
assessment  of  these  two  properties  is  justified."  This, 
too,  raises  a  definite  question  about  which  there  can  be 
intelligent  discussion. 

The  complainant,  still  dissatisfied,  then  says  to  the  Board: 
"I  do  not  think  that  the  value  which  you  have  placed  on 
my  building  is  right.  How  did  you  work  out  this  value?" 
The  Board  replies:  "Your  building  is  so  many  feet  long 
by  so  many  feet  deep;  it  is  so  many  stories  high;  it  has 
so  many  square  feet  of  floor  area;  it  plainly  belongs  to 
such  a  class  of  buildings  for  which  the  factor  of  value  or, 
in  other  words,  the  construction  cost  when  new  is  so 
much  per  square  foot.  The  building  is  now  some  years 
old,  so  we  have  reduced  the  factor  of  value  to  such  a  figure 
per  square  foot  to  allow  for  depreciation.  If  that  is 
wrong,  where  is  it  wrong?"  The  complainant  replies: 
"Well,  there  are  a  lot  of  other  buildings  in  the  neighbor- 
[53  1 


hood  of  about  the  same  character  which  you  have  assessed 
fifty  cents  less  per  square  foot  of  floor  space.  Here  is  a 
list  of  them."  This,  too,  raises  a  fair  subject  for  dis- 
cussion as  to  the  relative  value  of  the  complainant's 
building  and  the  others  mentioned  by  him. 
Under  such  a  system  no  time  is  wasted  discussing  whether 
a  particular  plot  of  land  of  such  a  shape  and  size  with  such 
a  kind  of  building  on  it  is  worth  more  or  less  than  any  one 
of  a  half  dozen  others  of  totally  different  shape  and  size, 
made  of  totally  different  material  and  which  cannot 
possibly  be  compared  the  one  with  the  other.  In  other 
words,  under  the  proposed  system  you  have  a  given 
measure  of  value,  or  standard,  to  apply  in  your  comparison 
and  not  one  kind  of  value  for  one  case  and  another  in 
another  case. 


(54 


Appendix 

RECOMMENDATION  OF  PROPOSED  SYSTEM  BY  ADVISORY  COM- 
MITTEE ON  MUNICIPAL  FINANCE 

On  the  fourth  day  of  October,  nineteen  hundred  and  twelve, 
the  Select  and  Common  Councils  of  the  city  of  Philadelphia,  by 
joint  resolution,  appointed  "An  Advisory  Committee  on  Mu- 
nicipal Finance,"  consisting  of  the  following  gentlemen: 

JOHN  P.  CONELLY,  Chairman       EFFINGHAM  B.  MORRIS 
CHARLES  SEGER  SAMUEL  T.  BODINE 

HARRY  J.  TRAINER  C.  S.  W.  PACKARD 

ROBERT  D.  DRIPPS  EDWARD  B.  SMITH 

CHARLES  C.  HARRISON  GEORGE  W.  NORRIS 

MORRIS  L.  COOKE 

Mr.  Morris  was  unable  to  serve,  and  EDWARD  T.  STOTESBURY 
and  JOHN  M.  WALTON  were  later  added  to  the  committee. 

The  unanimous  report  prepared  by  this  body  for  Councils 
reads  in  part  as  follows: 

"As  approximately  one-half  of  the  revenues  of  the  city  are 
derived  from  taxes  on  real  estate,  that  source  of  revenue  has  had 
the  chief  share  of  our  attention. 

"Equality  and  fairness  of  assessment  are  essential  in  any 
system  of  taxation.  If  such  equality  does  not  exist  a  $i  tax  rate 
may  mean  a  tax  rate  of  $1.10  or  more  to  one  owner,  and  a  tax 
rate  of  80  cents  or  less  to  another  owner. 

"We  have  been  very  favorably  impressed  by  certain  of  the 
methods  employed  in  the  assessment  of  real  estate  in  New  York 
city,  and  believe  that  the  Board  of  Revision  of  Taxes  is  ready  to 
put  the  same  into  effect  in  Philadelphia,  provided  [Councils] 
will  make  the  necessary  appropriation.  Lawson  Purdy,  presi- 
dent of  the  department  of  taxes  and  assessments  of  the  city  of 
New  York,  has  very  kindly  consented  to  detail  a  competent  mem- 
ber of  his  staff  to  acquaint  the  Board  of  Revision  of  Taxes  with 
the  methods  followed  by  his  department. 

[551 


'"We /therefore, 'submit  for  your  consideration  the  following 
recommendations : 

"That  the  Board  of  Revision  of  Taxes  be  respectfully  re- 
quested to  adopt  the  following  features  of  the  New  York  system 
of  assessing  realty: 

"  (a)  The  use  of  block  and  lot  maps. 
"  (b)  The  separate  assessment  of  land  and  improvements. 
"  (c)   The  use  of  land  value  maps. 

"  (d)  The  classification,  so  far  as  seems  wise  and  prac- 
ticable, of  buildings  into  various  types  or  classes,  and  the 
preparation  of  a  'factor  of  value'  for  each  class,  so  that 
the  construction  cost  of  any  building  of  a  particular  class 
can  be  readily  ascertained  by  multiplying  the  proper 
factor  by  the  total  number  of  square  feet  of  floor  space, 
or  by  the  total  number  of  cubic  feet  of  contents  of  the 
building. 

"  (e)  Systematic  publicity  as  to  both  methods  and  results 
of  assessment  of  real  estate,  including  the  annual  publica- 
tion in  reasonable  quantities  and  convenient  form  of: 
First,  land  value  maps.  Second,  a  series  of  pamphlets 
which  will  include  the  entire  assessment  roll  of  the  city. 
Third,  an  annual  report  of  the  same  general  character  as 
that  published  in  New  York  city. 

"It  is  our  thought  that  the  Board  of  Revision  of  Taxes  in 
carrying  out  these  suggestions  would  do  well  to  adopt  the  details 
of  the  system  in  use  in  New  York  city  in  so  far  as  the  same  are 
included  in  the  above  recommendations. 

"There  is  reason  to  hope  that  such  a  revision  of  the  methods 
of  assessment  will  add  to  both  the  revenue  and  the  borrowing 
capacity  of  the  city,  as  it  has  in  other  cities,  but  whether  it  does 
or  does  not,  we  believe  these  changes  will  tend  to  uniformity 
and  fairness,  and  should  therefore  be  adopted.  We  favor  the 
passage  of  the  bill  now  before  the  legislature  requiring  the  true 
consideration  to  be  stated  in  all  deeds,  and  we  also  favor  giving 
to  the  Board  of  Revision  of  Taxes  the  power  to  summon  the 
owners  of  real  estate  to  testify  as  to  values  under  oath  or 
affirmation." 


[56] 


Makers 

Syracuse,  N    y. 

PAT,  JM.  21.  1908 


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